René Napert

The trustee in bankruptcy sought a declaration that provincial statutory provisions allowing the CSST and CCQ to demand payment from employers for unpaid assessments and wages owed by a bankrupt contractor were inapplicable in bankruptcy.

The Supreme Court of Canada held that the provincial provisions do not subvert the scheme of distribution under the Bankruptcy and Insolvency Act.

The Court distinguished the Quebec mechanisms, which rely on civil law subrogation and compensation, from the deemed debt and withholding mechanism struck down in Husky Oil.

The Court also clarified that equitable set-off does not apply in bankruptcy in Quebec, as the civil law of compensation is the suppletive law.

The Supreme Court of Canada delivered an oral judgment dismissing the appeal from the Quebec Court of Appeal regarding the interpretation of s. 76 of the Canadian Wheat Board Act and the division of powers concerning flour mills.

The Court adopted the reasons given by the Court of Appeal of Quebec and dismissed the appeal with costs.