HUMAN RIGHTS TRIBUNAL OF ONTARIO
B E T W E E N:
Denise Gabrielle Robert
Applicant
-and-
Temagami Co-operative Inc.
Respondent
INTERIM DECISION
Adjudicator: Andrew M. Diamond
Indexed as: Robert v. Temagami Co-operative Inc.
Introduction
1This matter is currently scheduled for a two-day hearing on February 28 and 29 2012; however, the Human Rights Tribunal of Ontario (the “Tribunal”) has become aware that the respondent is bankrupt. This raises the preliminary issue as to whether this matter should proceed to its scheduled hearing.
2The following chronology of events is useful in framing the issue to be decided:
July 14, 2009, the applicant originally filed her Application with the Tribunal.
February 9, 2010, the respondent filed its Response to the Application with the Tribunal.
June 6, 2010, the applicant filed her Reply to the Response.
November 22, 2010, the respondent made an assignment in bankruptcy under the Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, as amended, (the “BIA”).
October 25, 2011, the Tribunal was advised by Paddon + York Inc., the respondent’s trustee in bankruptcy, of the assignment.
3In the Application, the applicant seeks monetary compensation from the respondent as well as an apology from the respondent board of directors as well as an employee of the respondent.
Law and Analysis
[4] The BIA is designed to permit the orderly liquidation and distribution of a bankrupt’s estate to its creditors. Part of that regime are the stay provisions which are designed to ensure that all creditors are treated fairly and in order of their priorities. Section 69.3(1) of the BIA reads:
Subject to subsections (1.1) and (2) and sections 69.4 and 69.5, on the bankruptcy of any debtor, no creditor has any remedy against the debtor or the debtor’s property, or shall commence or continue any action, execution or other proceedings, for the recovery of a claim provable in bankruptcy.
5Section 2 of the BIA defines a creditor as “a person having a claim provable as a claim under the BIA”. Section 121 of the BIA defines provable claims as:
All debts and liabilities, present or future, to which the bankrupt is subject on the day on which the bankrupt becomes bankrupt or to which the bankrupt may become subject before the bankrupt’s discharge by reason of any obligation incurred before the day on which the bankrupt becomes bankrupt shall be deemed to be claims provable in proceedings under this Act.
The purpose of the subsection is, so far as possible, to include every kind of claim in the definition of ‘provable claim’…” (L.W. Houlden, G.B. Morawetz & J.P. Sarra, eds., 2009 Annotated Bankruptcy and Insolvency Act (Toronto: Thomson Carswell, 2008), at p. 68.) Allowing parties to unilaterally elect whether or not their claim is provable in bankruptcy would defeat the intention of the BIA and its stay provisions.
6In the normal course a creditor of an individual who makes an assignment in bankruptcy under the provisions of the BIA would file a proof of claim with the trustee setting out how much was owed to them by the proponent debtor. It is then the responsibility of the trustee to admit or deny the claim, and if unliquidated, value the claim for the purpose of distributing the estate on a pro rata basis. However, in this case, the trustee advises that on the sale of the assets there was a shortfall to the secured creditor and that unsecured creditors received no dividend from the estate.
7In Jodoin v. Ciro’s Jewellers, [1996] O.H.R.B.I.D No. 1, a panel of the then Human Rights Board of Inquiry concluded that s. 69.1 of the BIA did not stay (human rights) proceedings based as a result of Fitzgibbon v. R., 1990 CanLII 102 (SCC), [1990] 1 S.C.R. 1005. No further analysis is provided. In my view, Fitzgibbon is entirely distinguishable and, consequently, I do not accept the conclusion reached in Jodoin. Mr. Fitzgibbon was a lawyer who had been convicted of fraud and ordered to make restitution. At the time of the conviction and restitution order, Mr. Fitzgibbon was an undischarged bankrupt. Mr. Fitzgibbon attempted to argue that as a result of the BIA stay provisions, the criminal court did not have the authority to order restitution. Mr. Justice Cory of the Supreme Court of Canada found that the stay provisions of the BIA did not act to prevent a court issuing a restitution order. However, even in coming to this conclusion Justice Cory recognized that:
There is a fundamentally important distinction between the original compensation order and, which is ordered against the person by which the court recognizes and acknowledges the indebtedness, and the subsequent filing in the Superior Court which can convert that personal order into an order against property of the accused.
Section [69(1)] of the BIA would preclude the enforcement of the latter. This is because such enforcement would result in the granting of the very priorities which the BIA seeks to avoid.
8Where appropriate, the Bankruptcy Court will lift the statutory stay to allow litigants either in other actions before the court or in other forums to continue those claims. However, it is the Bankruptcy Court that is tasked with the management of litigation against parties who have been granted protection under the BIA.
DECISION
[9] I am of the view that the Application is stayed. If the applicant wishes to proceed with her Application, she must within 14 days of this decision either:
1. Provide evidence that the stay under the BIA has been lifted or;
2. Provide written submissions in support of its position that it is entitled to continue with its Application before the Tribunal.
If no such evidence or submissions are received before the prescribed deadline, the Application may be dismissed.
[10] I am not seized of this matter.
Dated at Toronto, this 10th day of January, 2012.
“Signed by”
Andrew M. Diamond
Member