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Late payment by bankrupt debtor was in the ordinary course of business and not a fraudulent preference.
The trustee in bankruptcy appealed a decision finding that a late payment made by the bankrupt company to a creditor was not a fraudulent preference.
The Supreme Court of Canada dismissed the appeal, holding that the payment was made in the 'ordinary course of business' under s. 73 of the Bankruptcy Act.
The Court determined that 'ordinary course of business' must be assessed based on the circumstances of each case, including the business relationship between the parties and industry standards.
In this case, late payments were normal between the parties and standard in their industry.
