Olafson (Bankrupt), Re, 2015 ABQB 397

• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: June 12, 2015
• Citations: 2015 ABQB 397;[2015] A.R. TBEd. JN.128

Olafson (Bankrupt), Re, [2015] A.R. TBEd. JN.128

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Currently being edited for A.R. - judgment temporarily in rough form.

Temp. Cite: [2015] A.R. TBEd. JN.128

In The Matter Of the Bankruptcy of Karen Terese Olafson

(BE01 651767; 2015 ABQB 397)

Indexed As: Olafson (Bankrupt), Re

Alberta Court of Queen's Bench

Judicial District of Calgary

Farrington, Registrar

June 22, 2015.

Summary:

The bankrupt entered into an agreement with the trustee at the outset of the bankruptcy to pay $200 per month to the trustee. A total of $1,800 was accumulated. The funds were remitted primarily for the purpose of making certain that they would be available to pay the trustee's fees. The trustee advised that initially it was not clear that there would be sufficient realizations in the estate to pay the fees, and it appeared that this would not be a bankruptcy that required surplus income payments. The trustee applied for an order authorizing the return of the $1,800 to the bankrupt. The Office of the Superintendent of Bankruptcy ("OSB") objected. The OSB argued that the funds in question were "property" under s. 67 of the Bankruptcy and Insolvency Act (BIA). The OSB's position was that once the funds were received, they became property and part of the estate that was distributable to creditors pursuant to s. 136 of the BIA. The trustee's position was that the funds never became "property" and part of the estate, and that the funds were received for a specific purpose being payment of the trustee's fees if assets were not otherwise in place to pay those fees.

A Registrar in Bankruptcy of the Alberta Court of Queen's Bench allowed the trustee's application for an order authorizing the return of the $1,800 to the bankrupt.

Bankruptcy - Topic 402

Property of bankrupt - General - What constitutes - See paragraphs 25 to 33.

Bankruptcy - Topic 2777

Trustees - Compensation - Agreement - Effect of - See paragraphs 19 to 33.

Bankruptcy - Topic 6481

Administration of estate - Distribution - General - See paragraphs 25 to 33.

Counsel:

David L. Smith (Bromwich & Smith Inc.);

Rob Gordon (Office of the Superintendent of Bankruptcy).

This application was heard on June 12, 2015, before Farrington, Registrar in Bankruptcy, of the Alberta Court of Queen's Bench, Judicial District of Calgary, who delivered the following memorandum of decision on June 22, 2015.