Legal Blog

Bankruptcy Annulment

Tran v. Royal Bank of Canada 2022 Ont SCJ

Creditor with a debt of $488,000 obtained an order of bankruptcy against debtor. One year later, debtor’s father bought the creditor’s debt (at a discount) and debtor applied to have the bankruptcy annulled. After all, the creditor did not care, the trustee did not care, and her father did not care. The judge did. s. 181(1) allows a judge discretion to annul a bankruptcy order if it ought not to have been made. In this case, the order should have been made. Further, the judge held that the there were public considerations. The bankrupt’s conduct is important.

Written by Jonathan Speigel, the founding partner of Speigel Nichols Fox LLP, leads the litigation and construction practices.