Area of Law: Credit, Debt and Bankruptcy
Answer # 0267
Duties under the Bankruptcy and Insolvency ActRegion: Ontario Answer # 0267
If you decide to file for bankruptcy, you must fulfill certain duties that are set out in the Federal Bankruptcy and Insolvency Act (BIA).
1. When you meet with a Licensed Insolvency Trustee (LIT) to begin the process of filing for bankruptcy, you must:
- provide the LIT with a complete list of all of your assets and debts;
- give the LIT all of your credit cards; and
- advise the LIT of property that you have sold or given away in the last five years, and whether you have paid relatives or non-arm’s length persons within the last year. If you have done any non-arm’s length transferring of assets or payments, it may be a good idea to see a bankruptcy lawyer before going to see an LIT.
2. Once the LIT has filed the necessary documents with the Office of the Superintendent of Bankruptcy (OSB), you are officially “in bankruptcy” and now have further responsibilities under the BIA:
- you have a duty to keep the LIT informed of any changes in your financial or personal situation, such as becoming employed or changing your address;
- are required to attend a meeting with your creditors if one is held;
- you may be examined by an OSB representative to discuss the bankruptcy;
- you must attend financial two counselling sessions with your LIT;
- you must assist the LIT in handling your estate; and
- you may also have to pay a portion of your regular income (called surplus income payments) to the LIT to pay your creditors.
Once you are discharged, which occurs about nine months after filing for a first-time bankrupt, these obligations end. View the Bankruptcy and Insolvency Act for more information.
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