In Canada, the bankruptcy process must be administered by a licensed insolvency trustee. A trustee will ensure that all paperwork is completed and filed correctly. He or she will also administer the bankruptcy process and be your contact with your unsecured creditors. During bankruptcy, no unsecured creditors may contact you directly. Therefore, all communication will be done through your insolvency trustee. Canada federal law governs bankruptcies through the Bankruptcy and Insolvency Act.
What is an Insolvency Trustee?
A licensed insolvency trustee is a person who has been trained, licensed and registered by the federal government to administer bankruptcy proceedings as well as consumer proposals. Trustees are bound by a strict code of ethics. When you meet with a trustee, he or she is required by law to explain all potential options to you, even those that the trustee does not provide. It is then your decision as to how you would like to proceed. Most insolvency trustees in Canada offer free consultations. At this consultation, the trustee will review your particular situation and let you know the options available to you. If bankruptcy is an option and if this is the option that you choose to proceed with, your trustee will begin the bankruptcy process.
Finding an Insolvency Trustee in Canada
When it comes to finding an insolvency trustee in Canada, the Office of the Superintendent of Bankruptcy Canada keeps a trustee registry that is available online. The registry contains the main office coordinates of all trustees licensed by the Office of the Superintendent of Bankruptcy. While all licensed trustees are registered and regulated by the federal government, it’s important that you choose a person who you can work with. When choosing a trustee, consider the same factors that you would consider if you were choosing any other professional. This includes experience, level of education, training, accreditation, track record and other factors. You will want to choose someone who is reliable and who understands that, while bankruptcy is a legal process, it is also a very emotional event for many people. The trustee that you choose to work with should make you feel comfortable and never pressure you into making a decision on your financial future. Your trustee should provide you with all of the options available and allow you to make a decision for yourself. A trustee should also take the time to understand your concerns, answer your questions and explain all options fully. He or she should provide you with clear details on your duties and what is expected of you during the bankruptcy process.
Duties under Bankruptcy
You will need to work with your trustee during the bankruptcy process. This means that you must cooperate with the trustee and fulfill the legal duties that are required of you during the bankruptcy period. These duties include:
- Keeping your contact information up to date with your insolvency trustee. If you move, change jobs or get a new phone number, you will need to provide your trustee with the updated information.
- Attending two financial counselling sessions. You are required to attend two financial counselling sessions as a part of the bankruptcy process. In these sessions, you will learn money management and budgeting tips that will help you remain financially stable after the bankruptcy process is complete. The sessions will also give you with information that will help you improve your credit rating after you have been discharged from bankruptcy.
- You need to provide your trustee with monthly income statements and records of expenses. These statements will be used to determine the cost of your bankruptcy and your trustee will use this information to calculate if you are required to make surplus income payments.
A licensed insolvency trustee in Canada works with debtors to explain these duties and any other required duties. At the conclusion of the bankruptcy process, if you have fulfilled all duties, you will be discharged. Your trustee will sign your certificate of discharge which will then be mailed to you in approximately 30 days after discharge. You are then free to begin rebuilding your financial life.