An Act to amend the Bankruptcy and Insolvency Act, the Companies’ Creditors Arrangement Act, the Wage Earner Protection Program Act and chapter 47 of the Statutes of Canada, 2005 (S.C. 2007, c. 36)
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Assented to 2007-12-14
An Act to amend the Bankruptcy and Insolvency Act, the Companies’ Creditors Arrangement Act, the Wage Earner Protection Program Act and chapter 47 of the Statutes of Canada, 2005
S.C. 2007, c. 36
Assented to 2007-12-14
An Act to amend the Bankruptcy and Insolvency Act, the Companies’ Creditors Arrangement Act, the Wage Earner Protection Program Act and chapter 47 of the Statutes of Canada, 2005
SUMMARY
This enactment amends the Bankruptcy and Insolvency Act, the Companies’ Creditors Arrangement Act, the Wage Earner Protection Program Act and chapter 47 of the Statutes of Canada, 2005 to ensure the effective operation of that chapter 47.
Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:
R.S., c. B-3; 1992, c. 27, s. 2BANKRUPTCY AND INSOLVENCY ACT
Marginal note:1999, c. 28, s. 146(2)
1. (1) The definition “corporation” in section 2 of the Bankruptcy and Insolvency Act is replaced by the following:
“corporation”
« personne morale »
“corporation” means a company or legal person that is incorporated by or under an Act of Parliament or of the legislature of a province, an incorporated company, wherever incorporated, that is authorized to carry on business in Canada or has an office or property in Canada or an income trust, but does not include banks, authorized foreign banks within the meaning of section 2 of the Bank Act, insurance companies, trust companies, loan companies or railway companies;
(2) The definitions “court” and “person” in section 2 of the Act, as enacted by subsection 2(3) of chapter 47 of the Statutes of Canada, 2005, are replaced by the following:
“court”
« tribunal »
“court”, except in paragraphs 178(1)(a) and (a.1) and sections 204.1 to 204.3, means a court referred to in subsection 183(1) or (1.1) or a judge of that court, and includes a registrar when exercising the powers of the court conferred on a registrar under this Act;
“person”
« personne »
“person” includes a partnership, an unincorporated association, a corporation, a cooperative society or a cooperative organization, the successors of a partnership, of an association, of a corporation, of a society or of an organization and the heirs, executors, liquidators of the succession, administrators or other legal representatives of a person;
(3) The definitions “current assets”, “director”, “income trust” and “transfer at undervalue” in section 2 of the Act, as enacted by subsection 2(5) of chapter 47 of the Statutes of Canada, 2005, are replaced by the following:
“current assets”
« actif à court terme »
“current assets” means cash, cash equivalents — including negotiable instruments and demand deposits — inventory or accounts receivable, or the proceeds from any dealing with those assets;
“director”
« administrateur »
“director” in respect of a corporation other than an income trust, means a person occupying the position of director by whatever name called and, in the case of an income trust, a person occupying the position of trustee by whatever name called;
“income trust”
« fiducie de revenu »
“income trust” means a trust that has assets in Canada if
(a) its units are listed on a prescribed stock exchange on the date of the initial bankruptcy event, or
(b) the majority of its units are held by a trust whose units are listed on a prescribed stock exchange on the date of the initial bankruptcy event;
“transfer at undervalue”
« opération sous-évaluée »
“transfer at undervalue” means a disposition of property or provision of services for which no consideration is received by the debtor or for which the consideration received by the debtor is conspicuously less than the fair market value of the consideration given by the debtor;
(4) Paragraph (b) of the definition “date of the bankruptcy” in section 2 of the English version of the Act, as enacted by subsection 2(5) of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
(b) the filing of an assignment in respect of the person, or
Marginal note:1997, c. 12, s. 1(5)
(5) The portion of the definition “date of the initial bankruptcy event” in section 2 of the English version of the Act before paragraph (a) is replaced by the following:
“date of the initial bankruptcy event”
« ouverture de la faillite »
“date of the initial bankruptcy event”, in respect of a person, means the earliest of the day on which any one of the following is made, filed or commenced, as the case may be:
(6) The definition “date of the initial bankruptcy event” in section 2 of the Act is amended by striking out the word “or” at the end of paragraph (d), by adding the word “or” at the end of paragraph (e) and by adding the following after paragraph (e):
(f) proceedings under the Companies’ Creditors Arrangement Act;
(7) Section 2 of the Act is amended by adding the following in alphabetical order:
“equity claim”
« réclamation relative à des capitaux propres »
“equity claim” means a claim that is in respect of an equity interest, including a claim for, among others,
(a) a dividend or similar payment,
(b) a return of capital,
(c) a redemption or retraction obligation,
(d) a monetary loss resulting from the ownership, purchase or sale of an equity interest or from the rescission, or, in Quebec, the annulment, of a purchase or sale of an equity interest, or
(e) contribution or indemnity in respect of a claim referred to in any of paragraphs (a) to (d);
“equity interest”
« intérêt relatif à des capitaux propres »
“equity interest” means
(a) in the case of a corporation other than an income trust, a share in the corporation — or a warrant or option or another right to acquire a share in the corporation — other than one that is derived from a convertible debt, and
(b) in the case of an income trust, a unit in the income trust — or a warrant or option or another right to acquire a unit in the income trust — other than one that is derived from a convertible debt;
“shareholder”
« actionnaire »
“shareholder” includes a member of a corporation — and, in the case of an income trust, a holder of a unit in an income trust — to which this Act applies;
2. Subsection 4(5) of the Act, as enacted by subsection 5(4) of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
Marginal note:Presumptions
(5) Persons who are related to each other are deemed not to deal with each other at arm’s length while so related. For the purpose of paragraph 95(1)(b) or 96(1)(b), the persons are, in the absence of evidence to the contrary, deemed not to deal with each other at arm’s length.
3. Section 11.1 of the Act is amended by adding the following after subsection (2):
Marginal note:Agreement to provide compilation
(3) The Superintendent may enter into an agreement to provide a compilation of all or part of the information that is contained in the public record.
4. Subsection 13.3(1.1) of the French version of the Act, as enacted by subsection 11(1) of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
Marginal note:Avis au surintendant
(1.1) S’il demande l’autorisation visée au paragraphe (1), le syndic envoie sans délai une copie de sa demande au surintendant.
5. Subsection 13.4(1) of the Act, as enacted by section 12 of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
Marginal note:Trustee may act for secured creditor
13.4 (1) No trustee may, while acting as the trustee of an estate, act for or assist a secured creditor to assert a claim against the estate or to realize or otherwise deal with a security that the secured creditor holds, unless the trustee has obtained a written opinion from independent legal counsel that the security is valid and enforceable against the estate.
Marginal note:1997, c. 12, s. 12
6. The portion of subsection 14.01(1) of the Act before paragraph (a) is replaced by the following:
Marginal note:Decision affecting licence
14.01 (1) If, after making or causing to be made an inquiry or investigation into the conduct of a trustee, it appears to the Superintendent that
7. Subsections 14.02(1.1) and (1.2) of the Act, as enacted by section 15 of chapter 47 of the Statutes of Canada, 2005, are replaced by the following:
Marginal note:Summons
(1.1) The Superintendent may, for the purpose of the hearing, issue a summons requiring and commanding any person named in it
(a) to appear at the time and place mentioned in it;
(b) to testify to all matters within their knowledge relative to the subject matter of the inquiry or investigation into the conduct of the trustee; and
(c) to bring and produce any books, records, data, documents or papers — including those in electronic form — in their possession or under their control relative to the subject matter of the inquiry or investigation.
Marginal note:Effect throughout Canada
(1.2) A person may be summoned from any part of Canada by virtue of a summons issued under subsection (1.1).
8. Paragraph 14.03(2)(b) of the French version of the Act, as enacted by subsection 16(2) of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
b) la tenue des investigations ou des enquêtes prévues à l’alinéa 5(3)e);
9. (1) Paragraph 14.06(1.1)(c) of the French version of the Act, as enacted by section 17 of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
c) les autres personnes qui sont nommément habilitées à prendre — ou ont pris légalement — la possession ou la responsabilité d’un bien acquis ou utilisé par une personne insolvable ou un failli dans le cadre de ses affaires.
(2) Subsection 14.06(1.2) of the Act, as enacted by section 17 of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
Marginal note:No personal liability in respect of matters before appointment
(1.2) Despite anything in federal or provincial law, if a trustee, in that position, carries on the business of a debtor or continues the employment of a debtor’s employees, the trustee is not by reason of that fact personally liable in respect of a liability, including one as a successor employer,
(a) that is in respect of the employees or former employees of the debtor or a predecessor of the debtor or in respect of a pension plan for the benefit of those employees; and
(b) that exists before the trustee is appointed or that is calculated by reference to a period before the appointment.
Marginal note:1997, c. 12, s. 15(1)
(3) Subsection 14.06(1.3) of the Act is replaced by the following:
Marginal note:Status of liability
(1.3) A liability referred to in subsection (1.2) is not to rank as costs of administration.
Marginal note:Liability of other successor employers
(1.4) Subsection (1.2) does not affect the liability of a successor employer other than the trustee.
10. Subsections 30(5) and (6) of the Act, as enacted by section 23 of chapter 47 of the Statutes of Canada, 2005, are replaced by the following:
Marginal note:Related persons
(5) For the purpose of subsection (4), in the case of a bankrupt other than an individual, a person who is related to the bankrupt includes
(a) a director or officer of the bankrupt;
(b) a person who has or has had, directly or indirectly, control in fact of the bankrupt; and
(c) a person who is related to a person described in paragraph (a) or (b).
Marginal note:Factors to be considered
(6) In deciding whether to grant the authorization, the court is to consider, among other things,
(a) whether the process leading to the proposed sale or disposition of the property was reasonable in the circumstances;
(b) the extent to which the creditors were consulted;
(c) the effects of the proposed sale or disposition on creditors and other interested parties;
(d) whether the consideration to be received for the property is reasonable and fair, taking into account the market value of the property;
(e) whether good faith efforts were made to sell or otherwise dispose of the property to persons who are not related to the bankrupt; and
(f) whether the consideration to be received is superior to the consideration that would be received under any other offer made in accordance with the process leading to the proposed sale or disposition of the property.
11. Subsection 36(1) of the French version of the Act, as enacted by section 28 of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
Marginal note:Devoirs de l’ancien syndic en cas de substitution
36. (1) À la nomination d’un syndic substitué, le syndic qui l’a précédé soumet immédiatement ses comptes au tribunal et remet au syndic substitué tous les biens de l’actif, avec tous les livres, registres et documents du failli et ceux qui sont relatifs à l’administration de l’actif. Il lui remet également un état complet des recettes provenant des biens du failli ou d’autres sources, intérêts y compris, et de ses débours et dépenses, ainsi que de la rémunération qu’il réclame. L’état est accompagné d’un document contenant la description détaillée de tous les biens du failli qui n’ont pas été vendus ou réalisés, où sont indiqués, en plus de leur valeur, le motif pour lequel ils ne l’ont pas été, ainsi que la façon dont il en a été disposé.
Marginal note:1997, c. 12, s. 25(2)
12. Subsection 41(8.1) of the Act is replaced by the following:
Marginal note:Investigation not precluded
(8.1) Nothing in subsection (8) is to be construed as preventing an inquiry, investigation or proceeding in respect of a trustee under subsection 14.01(1).
13. Section 46 of the Act is amended by adding the following after subsection (2):
Marginal note:Place of filing
(3) An application under subsection (1) is to be filed in a court having jurisdiction in the judicial district of the locality of the debtor.
14. (1) Subsection 47(1) of the Act, as enacted by subsection 30(1) of chapter 47 of the Statutes of Canada, 2005, is replaced by the following:
Marginal note:Appointment of interim receiver
47. (1) If the court is satisfied that a notice is about to be sent or was sent under subsection 244(1), it may, subject to subsection (3), appoint a trustee as interim receiver of all or any part of the debtor’s property that is subject to the security to which the notice relates until the earliest of
(a) the taking of possession by a receiver, within the meaning of subsection 243(2), of the debtor’s property over which the interim receiver was appointed,
(b) the taking of possession by a trustee of the debtor’s property over which the interim receiver was appointed, and
(c) the expiry of 30 days after the day on which the interim receiver was appointed or of any period specified by the court.
Marginal note:1992, c. 27, s. 16(1)
(2) Subsection 47(2) of the Act is amended by striking out the word “and” at the end of paragraph (b) and by replacing paragraph (c) with the following:
(c) take conservatory measures; and
(d) summarily dispose of property that is perishable or likely to depreciate rapidly in value.
(3) Section 47 of the Act is amended by adding the following after subsection (3):
Marginal note:Place of filing
(4) An application under subsection (1) is to be filed in a court having jurisdiction in the judicial district of the locality of the debtor.
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