The defendant brought a motion to dismiss a breach of contract action on the basis that the plaintiff lacked legal capacity because he was an undischarged bankrupt.
The court considered the effect of s. 71 of the Bankruptcy and Insolvency Act and the principle that property and causes of action vest in the trustee upon bankruptcy.
The plaintiff argued that the claim related to after-acquired property and could therefore be pursued personally.
The court rejected this argument, holding that an undischarged bankrupt cannot commence or maintain an action concerning property interests vested in the trustee, subject only to narrow statutory exceptions not applicable here.
The action was declared a nullity and dismissed as an abuse of process, prior orders obtained without notice were set aside, and substantial indemnity costs were awarded.
