The plaintiff brought a motion to declare that a default judgment debt owed by the defendant survived his assignment into bankruptcy pursuant to s. 178(1)(d) of the Bankruptcy and Insolvency Act.
The underlying action involved a breach of trust under the Construction Act for failing to pay for construction materials.
The court held that the defendant's extrinsic evidence attempting to explain the breach of trust was inadmissible on a Rule 59.06(2) motion.
The court found that the deemed admissions from the default judgment established misappropriation while acting in a fiduciary capacity, and therefore the debt survived the bankruptcy.
