SUPERIOR COURT OF JUSTICE – ONTARIO

COMMERCIAL LIST

RE: IN THE MATTER OF the Bankruptcy of Alexander Josipovicz

BEFORE: D. M. Brown J.

COUNSEL: D. Shiller, for Kenneth Whyte, moving party

David Levangie, for Milosh Pavlovicz, responding party

T. MacLennan, for the bankrupt, Alexander Josipovicz

HEARD: September 14, 2012

REASONS FOR DECISION

I. Motion to compel satisfaction of an undertaking given on a BIA s. 163(1) examination

[ 1 ] By handwritten endorsement dated July 26, 2012 I dealt with the refusals motion concerning the examinations of Messrs. Landau and Whyte. By Reasons dated September 24, 2012 ( 2012 ONSC 5361 ) I dealt with a motion by Kenneth Whyte for an order authorizing an examination of Milosh Pavlovicz under section 163 of the Bankruptcy and Insolvency Act .

[ 2 ] That same day counsel made submissions in respect of one unfulfilled undertaking given by the bankrupt, Alexander Josipovicz, on his section 163 examination conducted on August 16, 2011. At Questions 765 through 778 of his examination Mr. Josipovicz undertook to produce copies of complaints which he made to the Law Society of Upper Canada and the Human Rights Commission. Those documents were requested to ascertain whether in them Mr. Josipovicz had described the nature of his relationship with Mr. Pavlovich, an issue relevant to the bankrupt’s family unit status for purposes of his estate.

[ 3 ] Examining counsel and the Trustee made follow-up requests. By letter dated December 23, 2011 the bankrupt’s counsel enclosed “the complaint filed with the Human Rights Tribunal of Ontario”. In fact the document produced was an HRT “Request for Additional Information on Application under section 34” which the bankrupt signed on April 4, 2009; it was not the original complaint. Evidently the original complaint was dated December, 2009.

[ 4 ] A law clerk for the bankrupt’s counsel deposed that the document forwarded on December 23, 2011 was the only document in Mr. Josipovicz’s possession.

[ 5 ] In January, 2012 the bankrupt’s counsel advised that Mr. Josipovicz consented to the release of the Law Society complaint by the Goodmans firm directly to the Trustee. As well he wrote:

If you require my client’s further consent to the further release of the Human Rights complaint, my client consents to the release of the Human Rights complaint directly to the trustee.

[ 6 ] A stand-off then ensued. Examining counsel required the release of the documents to him; the bankrupt’s counsel stated that Mr. Josipovicz only would consent to their release directly to the Trustee.

[ 7 ] Kenneth Whyte, a creditor of the bankrupt’s estate, then moved for the release of the two documents directly to his counsel who had conducted the section 163(1) examination of the bankrupt. As mentioned in my September 24 Reasons, the creditors had authorized counsel for Mr. Whyte to conduct a BIA s. 163 examination of the bankrupt.

II. Positions of the parties

[ 8 ] Mr. Josipovicz does not want to deliver the documents to Mr. Whyte’s counsel. Instead, Mr. Josipovicz wants to deliver the documents to the Trustee, and he does not want the documents to form part of the public record.

[ 9 ] Mr. Landau, the Trustee’s representative, in paragraph 8 of his June 28, 2012 affidavit, deposed:

To date, I have not received a copy of the Human Rights complaint or the Law Society complaint that the Bankrupt undertook to produce at his section 163(1) examination. I expect the Bankrupt to deliver these undertakings to Mr. Shiller as he conducted the examination on behalf of the estate.

[ 10 ] Evidently Mr. Whyte already possesses a copy of the Human Rights Complaint, but he does not possess a copy of the Law Society complaint. On-going litigation exists outside the bankruptcy process involving the liquidation of Hippo Properties, a company in which Mr. Whyte and Mr. Josipovicz are 50% shareholders. The Trustee has advised that it has received creditor approval to offer for sale the bankrupt’s 50% interest in Hippo.

III. Analysis

[ 11 ] Let me start by saying that this is the sort of issue that counsel should have worked out without resorting to the Court. To be more precise, in light of the Trustee’s June 28, 2012 affidavit stating that he wished the bankrupt to deliver the documents to examining counsel, there was nothing left to argue about.

[ 12 ] In the particular circumstances of this case the bankrupt’s creditors authorized Mr. Whyte’s counsel to conduct the section 163(1) examination of the bankrupt. Examining counsel therefore was exercising the Trustee’s rights under section 163(1) of the BIA . For purposes of that examination Mr. Schiller was representing the interests of the Trustee and the estate. When a party gives an undertaking on his or her examination for discovery in a civil action, the standard practice is for the person examined to provide the answer to the undertaking to the examining counsel who was acting as the professional representative of his client. So, too, on an examination conducted under BIA s. 163(1), the bankrupt should provide the answers to his undertakings, including any documents, to the counsel who conducted the examination on behalf of the Trustee. In the particular circumstances of this case, that was Mr. Shiller, who also acts as counsel for a creditor.

[ 13 ] Mr. Josipovicz took the position that he does not possess copies of either the Human Rights complaint or the Law Society complaint. If that is the case, Mr. Josipovicz was the one who made the complaints, so he has the ability to obtain copies of them from both organizations. He must do so immediately and deliver them to Mr. Shiller, who conducted the section 163(1) examination, no later than Monday, October 15, 2012.

[ 14 ] When Mr. Shiller, who conducted the section 163(1) examination on behalf of the Trustee, receives those documentary answers to undertakings, he must communicate and deliver them to the Trustee. It is then up to the Trustee to decide how to disseminate the undertaking answers.

[ 15 ] Mr. Josipovicz contended that the two documents contained personal, confidential information which should not form part of the public record. I do not know what information resides in those documents. However, I order the Trustee not to file in any public record either the Human Rights complaint or the Law Society complaint received from the bankrupt without further direction of this Court so that an opportunity will exist to address any confidentiality concerns.

______ (original signed by) ______________

D. M. Brown J.

Date : October 5, 2012