The Superintendent of Bankruptcy appealed a deputy registrar’s decision granting an absolute discharge to bankrupt individuals who had failed to comply with surplus income payment obligations under the Bankruptcy and Insolvency Act.
The bankrupts had outstanding surplus income payments exceeding $10,000 and had not pursued mediation or other statutory remedies available under the Act.
The court held that s.172(2) of the BIA mandates specific responses where a bankrupt has failed to comply with payment requirements imposed under s.68 and does not permit an absolute discharge in such circumstances.
The deputy registrar exceeded jurisdiction by disregarding the statutory scheme and granting an absolute discharge despite non‑compliance.
The court annulled the discharge and ordered mediation, with a rehearing before a judge if mediation failed.
