Last week we posted about the duties of a bankrupt when declaring bankruptcy in Ontario. However it’s also important to understand the role and responsibilities of a bankruptcy trustee. You might even wonder why do I need to meet with a bankruptcy trustee to file a bankruptcy or a consumer proposal?
The answer to these questions is both simple, and complex.
The simple part is that in Canada only a person licensed by the federal government (specifically the Office of the Superintendent of Bankruptcy) after a comprehensive training and qualification program to become a bankruptcy trustee can administer Bankruptcies and Consumer Proposals.
The more complex answer as to what the role of a trustee is in the bankruptcy process has to do with the principles in play in the Bankruptcy And Insolvency Act, the most basic of which is fairness.
As a Trustee in Bankruptcy I am charged to ensure that the process of bankruptcy is fair to all parties.
As a federally licensed officer of the court, my role is principally to stand between people who owe money and those to whom it is owed and administer a process in which the rights and responsibilities of each party is cared for. I don’t work for either party, I serve as an independent administrator with duties and responsibilities to all parties.
Before You File Bankruptcy
From the standpoint of the debtor, the person who owes money and is considering declaring personal bankruptcy or making a proposal to creditors, my duty is to conduct an initial assessment where I:
- meet with you personally,
- review your situation,
- assess all possible remedies and explain them to you and to
- answer any questions you may have about the remedies available.
I am also responsible to advise you regarding the long term ramifications regarding your chosen procedure.
Once You Declare Bankruptcy
I must also prepare all the official paperwork, explain it and answer any questions you may have before your sign any documents to start any official procedure such as a bankruptcy or a proposal.
I am responsible to notify all your creditors and to provide them and any other interested party the required documents to substantiate the filing. If you are being garnished, I am responsible to provide your employer with the required documents to stop the garnishment.
From the standpoint of the creditors I am responsible to inform them of any filing, answer their questions and to admit their claims against the debtor. I am responsible, if appointed to also chair any meetings of creditors called to assess the bankruptcy or proposal.
I am responsible to distribute fairly any funds received as a consequence of the administration of the estate. If there are assets to be sold, I am responsible to get appraisals, and to sell assets in order to recover money to be distributed the the creditors.
I am also responsible to monitor the duties of the bankrupt person, and see to it that they participate in required financial counselling to assist in their rehabilitation. For people that have filed proposals, I am also required to ensure that they participate in credit counselling.
At the end of the process I am responsible to apply for the discharge of the bankrupt person, eliminating their debts.
There is a lot of action that happens in the background when a person chooses to file a bankruptcy or a proposal. The laws that govern these processes can be confusing and complex. As a Licensed Ontario Bankruptcy Trustee it’s my job to know the bankruptcy law and to be able to apply it to your specific situation to ensure that the resolution of your debt is done fairly and with a concern for all parties affected.
If you are dealing with too much debt, and think you need help, a licensed bankruptcy trustee is best equipped to help you.