Archive for June, 2007

May, 2007 Bankruptcies Rise

Friday, June 29th, 2007

2005 Bankruptcy StatisticsNEWS FLASH! June 29, 2007: The bankruptcy statistics for May, 2007 were released on the Internet today.

Insolvencies Rise in May, 2007 by 6.4%,
Year to Date Insolvencies are up by 1.7%.

There is a clear regional disparity, between the East and the West, in the rates of insolvency. The 6 eastern provinces, from Ontario to Newfoundland, had a rise of 10.7% in the total bankruptcy rate; increasing from 7,396 in May, 2006 to 8,186 in May, 2007. The West, with its booming economy, saw insolvencies decline by 9.2%; from 2,011 in May, 2006 to 1,825 in May, 2007.

Current Month:

    Consumer Bankruptcies up 6.5% compared with the same month last year.

    Business Bankruptcies down 16.5% compared with the same month last year.

    Proposals rose 14.6% compared with the same month last year.

Year to Date:

    Year to Date Insolvencies rose by 1.7% compared to the same month last year.

    Consumer Bankruptcies down 0.4% compared with the same period last year.

    Business Bankruptcies down 8.6% compared with the same period last year.

    Proposals rose 13.6% compared with the same period last year.

For more information and more detailed analysis please refer to this site.

Posted in Bankruptcy Statistics | No Comments »

Student Loans Bill to Reduce the 10 Year Wait

Friday, June 22nd, 2007

Themis
Bill Introduced to Change Student Loan Non-Dischargeability in a Bankruptcy from 10 Years to Two Years.

On May 29, 2007 Senator Yoine Goldstein introduced Bill S-227 in the Senate, entitled An Act to amend the Bankruptcy and Insolvency Act (student loans). The Bill received first reading on that date.

The Bill, if enacted, will amend the student loan provisions, ss. 178(1)(g) and (1.1), so as to provide for:
• a non-dischargeability period of two years from the end of studies (reduced from the current ten years).
• the mercy, or hardship, hearing (in which the court may discharge a student loan despite the bankruptcy having been filed during the non-dischargeability period) may take place at any time, rather than, as at present, only after the expiration of the non-dischargeability period; and
• the court may, at the mercy hearing, fix payment terms and conditions for the student loan, and may discharge part of the debt (rather than all or nothing, as under current jurisprudence:

Senator Goldstein is one of Canada’s leading insolvency lawyers who, before his recent Senate appointment, chaired the Personal Insolvency Task Force and acted as advisor to the Senate Banking Committee’s hearings in 2005 on Bill C-55. Evidently it is his intention to fold this Bill into the Senate hearings that will consider Bill C-62 (the 2007 amending bill) in the autumn, in which he is sure to play a very prominent role.

For more information please refer to Senator Goldstein’s speech to the Senate where he presented background history on student loans and well reasoned arguments for the reduction of the 10 year wait period before student loans can be erased in a bankruptcy.

Thanks to Bob Klotz for bringing this to our attention.

Posted in Bankruptcy Reform, Canadian Student Loans | 10 Comments »

June 13, 2007 - Bankruptcy Reform Back on Track. First reading passes in the House.

Thursday, June 14th, 2007

ThemisJune 13, 2007 - Bankruptcy Reform Back on track. First reading passes in the House. Bill C-62, 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 received first reading in the House of Commons this date.

The Bill had been hung up in the House over the issue of exempting RRSPs and RRIFs. The Bloc Québécois refused to approve passing of the Bill as it felt that the wording concerning RRSPs and RRIFs infringed on Quebec’s jurisdiction. In order to get the Bill passed unanimously, the wording concerning RRSPs and RRIFs was changed to make RRSP and RRIF exemptions in accordance with the laws of the province, where the provinces have such exemptions. The provinces that have RRSP and RRIF exemptions are Saskatchewan, Manitoba, Quebec, Prince Edward Island and Newfoundland and Labrador.

This change in RRSP wording will result in the following:

* A one year claw back will only be in effect for RRSPs in provinces without RRSP exemption laws;
* There will be no upper cap on the amount of RRSPs that can be protected;
* There will be no need to set up the RRSPs in a locked in plan to make them eligible for exemption;
* The court will have no jurisdiction to extend the one year claw back period period in an appropriate case.

Insolvency professionals and everyone interested in a fair and just bankruptcy system will be very upset with the proposed change to RRSPs. The change in wording governing the exemption of RRSPs opens the system up to abuse as a person will be able to set aside funds in an RRSP thereby protecting them in a bankruptcy and then once the person is discharge the funds can be used with impunity.

The Bill still has to go to the Senate, probably in the fall. The Senate can be expected to give the bill a thorough review, including hearing expert testimony.

You can Read Bill C-62 online

For more information on bankruptcy reform please refer to this link.

Posted in Bankruptcy Reform | No Comments »

Bankruptcies Rise in April, 2007

Friday, June 1st, 2007

2005 Bankruptcy StatisticsNEWS FLASH! May 31, 2007: The bankruptcy statistics for April 2007 were released on the Internet today.

Insolvencies Rise in April, 2007 by 5.3%,
Year to Date Insolvencies are up by 0.4%.

Current Month:

    Consumer Bankruptcies down 2.9% compared with the same month last year.

    Business Bankruptcies down 2.0% compared with the same month last year.

    Proposals rose 17.6% compared with the same month last year.

Year to Date:

    Year to Date Insolvencies rose by 0.4% compared to the same month last year.

    Consumer Bankruptcies down 2.2% compared with the same period last year.

    Business Bankruptcies down 6.5% compared with the same period last year.

    Proposals rose 13.3% compared with the same period last year.

For more information and more detailed analysis please refer to this site.

Posted in Bankruptcy Statistics | No Comments »