The moving party, Gaspare Caruso, brought a motion to annul the bankruptcy of 1947755 Ontario Ltd. under s. 181(1) of the Bankruptcy and Insolvency Act.
The assignment in bankruptcy had been made by John Hanna Nissan amidst a protracted dispute over corporate control.
The court found that the corporation was not insolvent at the time of the assignment, as its assets exceeded its liabilities and it could have met its obligations with a modicum of effort.
Furthermore, the court held that the assignment was an abuse of process, strategically timed to avoid scheduled examinations in the ongoing litigation.
The motion to annul the bankruptcy was granted.
