Bankruptcy and Insolvency Act (R.S.C., 1985, c. B-3)

Marginal note:Inquiry by official receiver

• 162 (1) The official receiver may, and on the direction of the Superintendent shall, make or cause to be made any inquiry or investigation that may be deemed necessary in respect of the conduct of the bankrupt, the causes of his bankruptcy and the disposition of his property, and the official receiver shall report the findings on any such inquiry or investigation to the Superintendent, the trustee and the court.

• (2) [Repealed, 2005, c. 47, s. 98]

• Marginal note:Application of section 164

  (3) Section 164 applies in respect of an inquiry or investigation under subsection (1).

Marginal note:Examination of bankrupt and others by trustee

• 163 (1) The trustee, on ordinary resolution passed by the creditors or on the written request or resolution of a majority of the inspectors, may, without an order, examine under oath before the registrar of the court or other authorized person, the bankrupt, any person reasonably thought to have knowledge of the affairs of the bankrupt or any person who is or has been an agent or a mandatary, or a clerk, a servant, an officer, a director or an employee of the bankrupt, respecting the bankrupt or the bankrupt’s dealings or property and may order any person liable to be so examined to produce any books, documents, correspondence or papers in that person’s possession or power relating in all or in part to the bankrupt or the bankrupt’s dealings or property.

• Marginal note:Examination of bankrupt, trustee and others by a creditor

  (2) On the application to the court by the Superintendent, any creditor or other interested person and on sufficient cause being shown, an order may be made for the examination under oath, before the registrar or other authorized person, of the trustee, the bankrupt, an inspector or a creditor, or any other person named in the order, for the purpose of investigating the administration of the estate of any bankrupt, and the court may further order any person liable to be so examined to produce any books, documents, correspondence or papers in the person’s possession or power relating in all or in part to the bankrupt, the trustee or any creditor, the costs of the examination and investigation to be in the discretion of the court.

• Marginal note:Examination to be filed

  (3) The evidence of any person examined under this section shall, if transcribed, be filed in the court and may be read in any proceedings before the court under this Act to which the person examined is a party.

Marginal note:Trustee may require books and property of bankrupt to be produced

• 164 (1) Where a person has, or is believed or suspected to have, in his possession or power any of the property of the bankrupt, or any book, document or paper of any kind relating in whole or in part to the bankrupt, his dealings or property, or showing that he is indebted to the bankrupt, he may be required by the trustee to produce the book, document or paper for the information of the trustee, or to deliver to him any property of the bankrupt in his possession.

• Marginal note:Examination on failure to produce

  (2) Where a person fails to produce a book, document or paper or to deliver property as required by this section within five days after being required to do so, the trustee may, without an order, examine the person before the registrar of the court or other authorized person concerning the property, book, document or paper that the person is supposed to possess.

• Marginal note:Compelling attendance

  (3) Any person referred to in subsection (1) may be compelled to attend and testify, and to produce on his examination any book, document or paper that under this section he is liable to produce, in the same manner and subject to the same rules of examination, and the same consequences of neglecting to attend or refusing to disclose the matters in respect of which he may be examined, as would apply to a bankrupt.

Marginal note:Admission of debt

• 165 (1) Where a person on examination admits that he is indebted to the bankrupt, the court may, on the application of the trustee, order him to pay to the trustee, at such time and in such manner as to the court seems expedient, the amount admitted or any part thereof either in full discharge of the whole amount in question or not, as the court thinks fit, with or without costs of the examination.

• Marginal note:Admission of having bankrupt’s property

  (2) Where any person on examination admits that he has in his possession any property belonging to the bankrupt, the court may, on the application of the trustee, order him to deliver to the trustee the property or any part thereof at such time, in such manner and on such terms as to the court may seem just.

Marginal note:Penalty for failure to attend for examination

166 If the bankrupt fails to present himself or herself for examination before the official receiver as required by paragraph 158(c) or if the bankrupt or any other person is served with an appointment or a summons to attend for examination and is paid or tendered the proper conduct money and witness fees as fixed by the General Rules but refuses or neglects to attend as required by the appointment or summons, the court may, on the application of the trustee or the official receiver, by warrant cause the bankrupt or other person so in default to be apprehended and brought up for examination.

Marginal note:Questions must be answered

167 Any person being examined is bound to answer all questions relating to the business or property of the bankrupt, to the causes of his bankruptcy and the disposition of his property.

Arrest of Bankrupts

Marginal note:Arrest of bankrupts under certain circumstances

• 168 (1) The court may by warrant cause a bankrupt to be arrested, and any books, papers and property in his possession to be seized, and the bankrupt, books, papers and property to be safely kept as directed until such time as the court may order, under the following circumstances:

  • (a) if, after the filing of a bankruptcy application against the bankrupt, it appears to the court that there are grounds for believing that the bankrupt has absconded or is about to abscond from Canada with a view of avoiding payment of the debt in respect of which the bankruptcy application was filed, of avoiding appearance to the application, of avoiding examination in respect of their affairs or of otherwise avoiding, delaying or embarrassing proceedings in bankruptcy against them;

  • (b) if, after making an assignment, it appears to the court that there are grounds for believing that the bankrupt has absconded or is about to abscond from Canada with a view of avoiding payment of his debts or of avoiding examination in respect of his affairs;

  • (c) if, after the filing of a bankruptcy application or an assignment, it appears to the court that there are reasonable grounds for believing that the bankrupt

    • (i) is about to remove their property with a view to preventing or delaying possession being taken of it by the trustee, or

    • (ii) has concealed or is about to conceal or destroy any of their property or any books, documents or writings that might be of use to the trustee or to the creditors of the bankrupt in the course of the bankruptcy proceedings;

  • (d) if the bankrupt removes any property in their possession above the value of twenty-five dollars without leave of the court after service of a bankruptcy application, or without leave of the trustee after an assignment has been made; or

  • (e) if, after the commencement of proceedings under this Act, he has failed to obey an order of the court.

• Marginal note:Payments after arrest

  (2) No payment or proposal made or security given after arrest made under this section is exempt from the provisions of this Act relating to fraudulent preferences.

Discharge of Bankrupts

Marginal note:Automatic discharge

• 168.1 (1) Subject to subsections (2) and 157.1(3), the following provisions apply in respect of an individual bankrupt other than a bankrupt referred to in subsection 172.1(1):

  • (a) in the case of a bankrupt who has never before been bankrupt under the laws of Canada or of any prescribed jurisdiction, the bankrupt is automatically discharged

    • (i) on the expiry of 9 months after the date of bankruptcy unless, in that 9-month period, an opposition to the discharge has been filed or the bankrupt has been required to make payments under section 68 to the estate of the bankrupt, or

    • (ii) on the expiry of 21 months after the date of bankruptcy unless an opposition to the discharge has been filed before the automatic discharge takes effect; and

  • (b) in the case of a bankrupt who has been a bankrupt one time before under the laws of Canada or of any prescribed jurisdiction, the bankrupt is automatically discharged

    • (i) on the expiry of 24 months after the date of bankruptcy unless, in that 24-month period, an opposition to the discharge has been filed or the bankrupt has been required to make payments under section 68 to the estate of the bankrupt, or

    • (ii) on the expiry of 36 months after the date of bankruptcy unless an opposition to the discharge has been filed before the automatic discharge takes effect.

• Marginal note:Application not precluded

  (2) Nothing in subsection (1) precludes a bankrupt from applying to the court for a discharge before the bankrupt would otherwise be automatically discharged, and that subsection ceases to apply to a bankrupt who makes such an application.

• Marginal note:Application of other provisions

  (3) The provisions of this Act concerning the discharge of bankrupts apply in respect of an individual bankrupt who has never before been bankrupt under the laws of Canada or of any prescribed jurisdiction, to the extent that those provisions are not inconsistent with this section, whether or not the bankrupt applies to the court for a discharge referred to in subsection (2).

• Marginal note:Notice of impending discharge

  (4) The trustee shall, not less than 15 days before the date of a bankrupt’s automatic discharge, give notice of the impending discharge, in the prescribed form, to the Superintendent, the bankrupt and every creditor who has proved a claim, at the creditor’s latest known address.

• Marginal note:Effect of automatic discharge

  (5) An automatic discharge is deemed, for all purposes, to be an absolute and immediate order of discharge.

• Marginal note:Certificate

  (6) Without delay after a bankrupt has been automatically discharged, the trustee shall issue a certificate to the discharged bankrupt, in the prescribed form, declaring that the bankrupt is discharged and is released from all debts except those matters referred to in subsection 178(1). The trustee shall send a copy of the certificate to the Superintendent.

Marginal note:Oppositions to automatic discharge

• 168.2 (1) The following provisions apply in respect of oppositions to the automatic discharge of an individual bankrupt:

  • (a) if the Superintendent opposes the discharge, the Superintendent must give notice of the opposition, together with the grounds for it, to the trustee and to the bankrupt before the automatic discharge would otherwise take effect;

  • (b) if a creditor opposes the discharge, the creditor must give notice of the opposition, together with the grounds for it, to the Superintendent, to the trustee and to the bankrupt before the automatic discharge would otherwise take effect; and

  • (c) if the trustee opposes the discharge, the trustee must give notice of the opposition in the prescribed form and manner, together with the grounds for the opposition, to the bankrupt and the Superintendent before the automatic discharge would otherwise take effect.

• Marginal note:Application for hearing

  (2) If the Superintendent, a creditor or the trustee opposes the automatic discharge of an individual bankrupt, the trustee shall, unless the matter is to be dealt with by mediation under section 170.1, apply without delay to the court for an appointment for the hearing of the opposition in the manner referred to in sections 169 to 176, and the hearing must be held

  • (a) within 30 days after the day on which the appointment is made; or

  • (b) at any later time that may be fixed by the court at the bankrupt’s or trustee’s request.

Marginal note:Bankruptcy to operate as application for discharge

• 169 (1) The making of a bankruptcy order against, or an assignment by, a person other than a corporation or an individual in respect of whom subsection 168.1(1) applies operates as an application for discharge.

• Marginal note:Appointment to be obtained by trustee

  (2) The trustee, before proceeding to his or her discharge and in any case not earlier than three months and not later than one year after the bankruptcy of a person for whom there is an application for discharge by virtue of subsection (1) shall, on five days notice to the bankrupt, apply to the court for an appointment for a hearing of the application for the bankrupt’s discharge, and the hearing must be held within 30 days after the day on which the appointment is made or at any other time that may be fixed by the court at the bankrupt’s or trustee’s request.

• (3) [Repealed, 2005, c. 47, s. 101]

• Marginal note:Bankrupt corporation

  (4) A bankrupt corporation may not apply for a discharge unless it has satisfied the claims of its creditors in full.

• Marginal note:Fees and disbursements of trustee

  (5) The court may, before issuing an appointment for hearing on application for discharge, if requested by the trustee, require such funds to be deposited with, or such guarantee to be given to, the trustee, as it deems proper, for the payment of his fees and disbursements incurred in respect of the application.

• Marginal note:Notice to creditors

  (6) The trustee, on obtaining or being served with an appointment for hearing an application for discharge, shall, not less than 15 days before the day appointed for the hearing of the application, send a notice of the hearing, in the prescribed form and manner, to the Superintendent, the bankrupt and every known creditor, at the creditor’s latest known address.

• Marginal note:Procedure when trustee not available

  (7) Where the trustee is not available to perform the duties required of a trustee on the application of a bankrupt for a discharge, the court may authorize any other person to perform such duties and may give such directions as it deems necessary to enable the application of the bankrupt to be brought before the court.

Marginal note:Trustee to prepare report

• 170 (1) The trustee shall, in the prescribed circumstances and at the prescribed times, prepare a report, in the prescribed form, with respect to

  • (a) the affairs of the bankrupt,

  • (b) the causes of his bankruptcy,

  • (c) the manner in which the bankrupt has performed the duties imposed on him under this Act or obeyed the orders of the court,

  • (d) the conduct of the bankrupt both before and after the date of the initial bankruptcy event,

  • (e) whether the bankrupt has been convicted of any offence under this Act, and

  • (f) any other fact, matter or circumstance that would justify the court in refusing an unconditional order of discharge,

  and the report shall be accompanied by a resolution of the inspectors declaring whether or not they approve or disapprove of the report, and in the latter case the reasons of the disapproval shall be given.

• Marginal note:Filing and service of report

  (2) Where an application of a bankrupt for a discharge is pending, the trustee shall file the report prepared under subsection (1) in the court not less than two days, and forward a copy thereof to the Superintendent, to the bankrupt and to each creditor who requested a copy not less than ten days, before the day appointed for hearing the application, and in all other cases the trustee, before proceeding to the discharge, shall file the report in the court and forward a copy to the Superintendent.

• Marginal note:Superintendent may file report

  (3) The Superintendent may make such further or other report to the court as he deems expedient or as in his opinion ought to be before the court on the application referred to in subsection (2).

• Marginal note:Representation by counsel

  (4) The trustee or any creditor may attend the court and be heard in person or by counsel.

• Marginal note:Evidence at hearing

  (5) For the purposes of the application referred to in subsection (2), the report of the trustee is evidence of the statements therein contained.

• Marginal note:Right of bankrupt to oppose statements in report

  (6) Where a bankrupt intends to dispute any statement contained in the trustee’s report prepared under subsection (1), the bankrupt shall at or before the time appointed for hearing the application for discharge give notice in writing to the trustee specifying the statements in the report that he proposes at the hearing to dispute.

• Marginal note:Right of creditors to oppose

  (7) A creditor who intends to oppose the discharge of a bankrupt on grounds other than those mentioned in the trustee’s report shall give notice of the intended opposition, stating the grounds thereof to the trustee and to the bankrupt at or before the time appointed for the hearing of the application for discharge.