Tanchak (Bankrupt), Re,

• Jurisdiction: Saskatchewan
• Judge: Thompson
• Neutral Citation: 2014 SKQB 151
• Citation: 2014 SKQB 151,(2014), 445 Sask.R. 271 (QB Reg.),445 SaskR 271,(2014), 445 SaskR 271 (QB Reg),445 Sask.R. 271
• Date: 22 May 2014
• Court: Court of Queen's Bench of Saskatchewan (Canada)

Tanchak (Bankrupt), Re (2014), 445 Sask.R. 271 (QB Reg.)

MLB headnote and full text

Temp. Cite: [2014] Sask.R. TBEd. JN.008

In The Matter Of the Bankruptcy of Ross Michael Tanchak

(Estate No. 23-804361; Court No. 13446; 2014 SKQB 151)

Indexed As: Tanchak (Bankrupt), Re

Saskatchewan Court of Queen's Bench

In Bankruptcy and Insolvency

Thompson, Registrar

May 22, 2014.

Summary:

Tanchak made an assignment in bankruptcy in June 2005. He disclosed to the Trustee in Bankruptcy only $2,800. He did not disclose that less than five months before his assignment, he sold shares for $32,000 and had the proceeds paid to his father. Ten years later, Tanchak applied to be discharged from bankruptcy. The Trustee, now discharged, opposed the application. At issue was: (1) did the discharged Trustee have standing to make submissions at the discharge hearing; (2) the scope of the Registrar's authority to discharge Tanchak; and (3) the appropriate conditions of any discharge.

A Registrar of the Saskatchewan Court of Queen's Bench, In Bankruptcy and Insolvency, held that the discharged Trustee had standing to make submissions at the discharge hearing, there was no authority to grant an absolute discharge, and it was appropriate to grant a conditional discharge upon Tanchak paying $3,600 at the rate of $150 per month.

Bankruptcy - Topic 2614

Trustees - Duties - Duty to court - A 32 year old bankrupt made his assignment in June 2005, disclosing to the Trustee in Bankruptcy that he had only $2,800 in assets - He did not disclose that less than five months before his assignment, he sold shares for $32,000 and had the proceeds paid to his father - Ten years later, Tanchak applied to be discharged from bankruptcy - The Trustee, now discharged, opposed the application - The bankrupt argued that the discharged Trustee had no standing to make submissions at the discharge hearing - A Registrar of the Saskatchewan Court of Queen's Bench, In Bankruptcy and Insolvency, held that a discharged trustee had limited authority under s. 41(10) of the Bankruptcy and Insolvency Act to continue "the performance of such duties as may be incidental to the full administration of an estate" - The Registrar held that the Trustee, as an officer of the court, had a duty to make an impartial report to the court on the circumstances of the bankruptcy, including the bankrupt's conduct, and to provide the court with a recommendation for the discharge disposition - The Registrar declined to exclude the Trustee's evidence - If the Trustee had not provided its supplementary report opposing discharge, the Registrar would have summoned the Trustee to provide that information - The 10 year delay was attributable to the bankrupt, not the Trustee - The Trustee's report and oral submissions were properly before the court - See paragraphs 6 to 19.

Bankruptcy - Topic 6842

Practice - Evidence and proof - Trustee's report - [See Bankruptcy - Topic 2614 ].

Bankruptcy - Topic 8892

Discharge of debtor - Grounds for refusal - Failure to satisfactorily account for loss or deficiency of assets - A 32 year old bankrupt made his assignment in June 2005, disclosing to the Trustee in Bankruptcy that he had only $2,800 in assets - He did not disclose that less than five months before his assignment, he sold shares for $32,000 and had the proceeds paid to his father - Ten years later, Tanchak applied to be discharged from bankruptcy - The Trustee, now discharged, opposed the application - A Registrar of the Saskatchewan Court of Queen's Bench, In Bankruptcy and Insolvency, held that an absolute discharge was not available where the bankrupt "failed to account satisfactorily for any loss of assets or for any deficiency of assets to meet the bankrupt's liabilities (ss. 173(d) of the BIA) and that he failed to perform the duties imposed on the bankrupt under the BIA (ss. 173(1)(o)), specifically the duty to disclose all property disposed of within the period beginning on the day that is one year before the date of the initial bankruptcy event. ... As two s. 173 factors have been established, this Court does not have the authority to grant an absolute discharge, notwithstanding that this bankruptcy has continued in excess of 10 years." - The bankrupt's misconduct could not just be forgiven, even with the passage of time - Since the bankrupt was still young and working, the appropriate disposition was a conditional discharge upon payment of $3,600 in installments of $150 per month - See paragraphs 20 to 42.

Bankruptcy - Topic 8897

Discharge of debtor - Grounds for refusal - Failure to perform duties - [See Bankruptcy - Topic 8892 ].

Bankruptcy - Topic 8907

Discharge of debtor - Absolute discharge - Circumstances when refused - [See Bankruptcy - Topic 8892 ].

Bankruptcy - Topic 8927

Discharge of debtor - Conditional discharge - Upon payment of installments - [See Bankruptcy - Topic 8892 ].

Cases Noticed:

Lloyd (Bankrupt), Re (2007), 221 Man.R.(2d) 9; 36 C.B.R.(5th) 233; 2007 MBQB 222 (Bktcy. Reg.), refd to. [para. 9].

Statutes Noticed:

Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, sect. 41(10) [para. 6].

Authors and Works Noticed:

Houlden, Lloyd W., Morawetz, Geoffrey B., and Sarra, Janis P., Bankruptcy and Insolvency Law of Canada (4th Ed.) (2013 Looseleaf), vol. 1, p. 1-124 [para. 10].

Counsel:

Janine Harding, for the bankrupt;

Marla Adams, for the Trustee.

This application was heard before Thompson, Registrar, of the Saskatchewan Court of Queen's Bench, In Bankruptcy and Insolvency, who delivered the following judgment on May 22, 2014.