The bankruptcy process is guided, outlined and governed by the Bankruptcy and Insolvency Act which is federal legislation. This means that most of the process is not something your trustee will dream up – it is passed by the Government of Canada.
There are some provincial laws that also govern what happens but normally federal law takes precedent.
For the vast majority of bankruptcies in Ontario a bankruptcy lawyer never enters into the process. A bankruptcy can only be filed by a licensed insolvency trustee, and most bankrupts only ever deal with their trustee – from the start of the process through to their discharge.
If a bankrupt does not complete their duties or if there is some dispute as to what is required to be done or how something should be sorted out, then it proceeds to the bankruptcy court. Bankruptcy court is utilized to settle all matters of issues, whether with trustees, bankrupts, creditors or even holders of assets.
If a creditor or the trustee is opposing your discharge (the date you will no longer have an obligation to pay your creditors the monies owed to them), the issues would normally be settled in the bankruptcy court.
If you and the trustee can come to an agreement prior to the court date, there would be no need for a bankruptcy lawyer. If you feel comfortable answering questions about your situation, your debts, your assets, your income and expenses by the court or the creditor who is opposing, then you likely are able to better answer the questions than any lawyer you might hire.
If you feel the creditor might try to take advantage or you feel you need advice on an ongoing basis during the bankruptcy hearing, then a bankruptcy lawyer might be someone you turn to for help. A bankruptcy lawyer can discuss the process and give you legal advice on matters that might be of issue but the process itself is fully administered by a licensed insolvency trustee.
Bankruptcy lawyers, because they are very specialized, are normally very expensive. Other lawyers might be able to help but would not necessarily be the best choice if you needed a lawyer during the bankruptcy process.
This issue is something you can discuss with the trustee should court or legal advice be necessary. Trustees are not lawyers and cannot give legal advice but do know many bankruptcy lawyers. We would be happy to refer you to one if you wish that type of advice. But be assured that most of the bankruptcy process is designed for you to complete it without legal expense and we try to explain the process well enough that you should be comfortable with it.
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