Paul Salewski

Dr. Baldeep Kaur Saran, a dentist, applied for a discharge from bankruptcy, which was opposed by her Trustee and the Canada Revenue Agency (CRA).

The bankruptcy was tax-driven, stemming from her participation in a 'natural person' detaxing scheme and a charitable giving scheme, resulting in over $3.1 million in tax debt (including penalties and interest).

The court found that her assets were less than 50 cents on the dollar of unsecured liabilities and that she contributed to the bankruptcy through unjustifiable extravagance in living.

The court rejected her claims of being duped and imputed income to her based on her past earnings and her husband's control over their combined income.

A conditional discharge was granted, requiring her to pay an additional $200,000 to the Trustee, file accurate tax returns, remain current with CRA obligations, and her discharge was suspended for a minimum of 36 months.

The bankrupt, a 72-year-old self-employed businessman with significant tax debts, applied for a discharge from bankruptcy.

The discharge was opposed by the Canada Revenue Agency and the Trustee in Bankruptcy.

The court found that the bankrupt had engaged in unjustifiable extravagance and had structured his affairs through a family trust to artificially lower his income.

The court granted a conditional discharge, requiring the bankrupt to pay $100,000 to the Trustee for the benefit of his creditors.

Creditors who had provided legal services and financing to an insolvent debtor sought declarations of a solicitor’s lien and a salvage lien against funds arising from the sale of a matrimonial home.

The debtor had filed a Notice of Intention and proposal under the Bankruptcy and Insolvency Act, triggering a stay of proceedings.

The court held the stay should not be lifted for the alleged salvage lien because the creditor had failed to properly perfect any assignment of execution debts or security interests.

Although the stay was lifted to consider potential solicitor’s liens, the court declined to grant charging orders, finding that equitable considerations weighed against relief where the lawyers failed to secure available mortgage protection and delayed seeking the lien while other creditors obtained competing claims.

The motion for liens and charging orders was denied.