Another retailer…

Another big retailer to add to the list of retainers that has gone under in the last couple of years…Covid-19 didn’t help, but was not the cause…https://www.reuters.com/article/us-neimanmarcus-bankruptcy-exclusive/exclusive-neiman-marcus-to-file-for-bankruptcy-as-soon-as-this-week-sources-idUSKBN2210CW

Update

I haven’t written on here in a while, but it’s important that we are all communicating during this crazy time. The COVID-19 crisis has caused us all to social isolate, and that means different things to different people. I know a lot of people have lost their jobs, even if its temporary, and been forced to apply for Employment Insurance (or other government assistances).

The Courts are hearing a very small amount of matters, and I will try to write more on here and keep everyone updated. In the meantime, if I can help with anything please let me know. There is still lots we can do.  Notice from the Superior Court of Justice

Hopefully this social isolation is over soon.

Stay healthy, and safe.

Student Loans

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One of questions I get the most is what will happen to my student loans in bankruptcy. In fact, I get this from professionals, students, and lots of other interested people. The basic premise of student loans is that they are not discharged or released under a bankruptcy or a proposal, unless it has been more then 7 years at the time of filing, from the date of the last time you were in school (graduation, end of classes, etc.). If it is less then 7 years but more then 5, we can apply to the Court to release the debts as part of the proposal or bankruptcy.

The factors involved range from whether it was a private or public loan, to what the circumstances surrounding the loan are, and what your own personal circumstances are.

It’s important to talk to a lawyer about this, as often times people in the industry don’t always understand what is released and what is not. If you are unsure, or you have any student loan debt, please feel free to call me. I’m happy to discuss the case with you, and let you know if it is worth pursuing.

 

Discharge after how long…

Re Tanchak (2014), 2014 SKQB 151

Mr.Tanchak applied to be discharged from bankruptcy in 2005. He was opposed by his Trustee. He declared assets of $2,800.00 and unsecured debt of $34,717.50. Nine years later, he applied to be discharged again. When he declared, he omitted to declare to the trustee that previous to declaring bankruptcy, only days before, he had entered into an agreement to sell his shares in a company and direct the proceeds to his father. No creditor or the trustee pursued the father, but the Trustee submitted that the integrity of the system was challenged by this. The registar agreed with the Trustee, and identified that the bankrupt had failed in his duty to disclose all property disposed of, and to account for any losses of assets. The court ruled that because of this, the court didn’t have the authority to grant an absolute discharge even though it had been 9 years. The court agreed that he would be discharged by paying $3,600 in monthly payments of $150.

 

Barter (Re) 2014 BCSC 528

In a recent decision of the Bankruptcy court of British Columbia, Registrar Master Young made a ruling regarding the title of a bankrupt’s property, and the non-exempt portion of the equity that a Trustee is entitled to realize on.

Under Section 71 of the BIA, the property of a bankrupt vests in the Trustee upon a declaration of bankruptcy. Further, Section 74 entitles a Trustee to register title or caution on this property, to claim interest.

I register these cautions and trustee’s interests for Trustee’s, and it is best to do them as soon as possible.

In this case, the Trustee did not register on title immediately, because he believed that there was no realizable equity in the home. He chose not to spend the money from the estate.

Yet, when the bankrupt’s wife was forced to declare bankruptcy as well, and chose a different trustee, that trustee chose to register an interest. She was then offered to buy the equity in the home that belonged to her, for $2,000. She did, and when the husband was made aware of this, he contacted his trustee.

The entire time, the husband had been trying to sell the home. He received an offer around the same time as his wife had bought her share of the equity. When he contacted the Trustee to ask about his wife, he told the Trustee about the offer. The trustee told him he could not sell the property, as it was not his to sell. He offered to sell the property/equity to the bankrupt, for $2,000.00 as well. The bankrupt bought it, and then proceeded to counter offer the sale, which was turned down. The house was ultimately sold for a shortfall on the mortgage.

The bankrupt then asked for his discharge, and asked for the $2,000.00 back from the Trustee.

The court ruled that the Trustee’s conduct fell below the standard, and that the Trustee had to return the funds. The trustee should have explained what the bankrupt was buying.  That there was potential for no return, and all of this should have been explained at the beginning of the bankruptcy.

The bankrupt was then granted an absolute discharge.