CITATION: In the matter of Giaitzis, 2026 ONSC 100

COURT FILE NO.: BK-23-02859160-0032

DATE: 2026-01-06

ONTARIO

SUPERIOR COURT OF JUSTICE

B E T W E E N:

IN THE MATTER OF GIAITZIS, ANTONIOS

Trustee (A. Kwok)

T. Hanrahan, Counsel for the opposing creditor, Paula Di Felice

Antonios Giaitzis, self-represented

HEARD: November 24, 2025

ENDORSEMENT

Associate Justice J. Kriwetz

Overview

1The Bankrupt, Antonios Giaitzis, (the “Bankrupt”) filed an assignment in bankruptcy on August 25, 2022.

2The Trustee, the Bankrupt, and counsel for the opposing creditor, Paula Di Felice, (the “Opposing Creditor”) appeared at the first discharge hearing on December 20, 2023. The hearing was adjourned to March 20, 2024, to provide the Trustee and the Opposing Creditor time to discuss a resolution, but no resolution was reached.

3At the discharge hearing held on March 20, 2024, the court ordered that the Bankrupt’s discharge hearing be adjourned to a date to be scheduled through the Hamilton Bankruptcy Office for a long hearing when time was available.

4The discharge hearing was then scheduled for October 22, 2025, but was adjourned to and heard on November 24, 2025.

5The evidence before the Court at the hearing on November 24, 2025, consisted of the reports of the Trustee dated November 21, 2023, March 15, 2024, and August 18, 2025, the affidavit of the Opposing Creditor, sworn December 14, 2023, and the testimony of the Bankrupt.

6The Bankrupt was not represented by counsel. The Trustee was in attendance. The Opposing Creditor was represented by counsel, but the Opposing Creditor did not attend the hearing.

The Trustee’s Recommendations

7In its report of November 21, 2023, the Trustee opposed the Bankrupt’s discharge on the grounds that he failed to honour his fee agreement and that he failed to provide the Trustee with his 2022 pre and post income tax information. The Trustee recommended the Bankrupt’s discharge be conditional upon the payment of $800.00 for the balance of the Trustee’s fees and upon providing the Trustee with his 2022 pre and post income tax information and evidence of post-bankruptcy income tax compliance.

8In its most recent report, the Trustee stated that the Bankrupt has paid the full cost of administering his estate. The Trustee now recommends that the Bankrupt be discharged conditional upon: (a) providing evidence of post-bankruptcy income tax filings and payment of liabilities, if any (at the hearing, the Trustee confirmed receipt of copies of the Bankrupt’s income tax filings for 2023 and 2024), (b) providing the Trustee with an undertaking not to obtain unsecured debt for a period of five years. The Trustee also recommends the Bankrupt’s discharge be suspended for six months.

The Opposing Creditor

9The Opposing Creditor filed a Notice of Opposition to the Bankrupt’s discharge dated May 19, 2023 citing the following grounds: (a) the Bankrupt’s “assets are not of a value equal to fifty cents on the dollar on the amount of his unsecured liabilities”, (b) the Bankrupt “lost assets without satisfactory reason to account for the deficiency to meet his liabilities”, and (c) the Bankrupt “was irresponsible in his action by culpable neglect of his business affairs which helped contribute to his bankruptcy filing.”

10Though further details of the Bankrupt’s debt to the Opposing Creditor will be set out below, the Opposing Creditor’s position is that very shortly after a default judgment was issued against the Bankrupt for the second time, the Bankrupt made an assignment into bankruptcy. The Opposing Creditor’s judgment comprised the single largest proven claim against the Bankrupt. Rather than considering any alternatives to deal with his indebtedness to the Opposing Creditor, he chose to make an assignment to defeat the Opposing Creditor’s judgment.

11The Opposing Creditor therefore submits that the Bankrupt’s discharge be conditional upon the Bankrupt paying approximately half of the indebtedness owed, being the sum of $15,000.00, on such terms as the Court may determine or the parties may agree.

Analysis

Summary of Proceedings Between the Opposing Creditor and the Bankrupt

12In her affidavit, the Opposing Creditor states that, in or about April 2018, she entered a contract with the Bankrupt for the repair and renovation of a water-damaged rental property. She stated that she pre-paid the Bankrupt $25,500.00 for the work, which was to commence on April 30, 2018, and be completed by June 1, 2018. However, when she attended at the rental property on June 8, 2018, she found that most of the work had not been completed. She stated that the Bankrupt abandoned the project on or about June 11, 2018, and she was then required to hire other contractors to complete the job.

13On February 5, 2019, the Opposing Creditor filed a claim against the Bankrupt in the Hamilton Small Claims Court for breach of contract.

14On May 22, 2019, default judgment was issued in favour of the Opposing Creditor for $25,000.00 plus interest and costs.

15On December 18, 2019, the Bankrupt successfully moved to set aside the default judgment and was allowed to file a defence. As part of the order, the Bankrupt was required to pay $100.00 in costs to the Opposing Creditor by January 19, 2020, failing which, the default judgment would be reinstated. According to the Opposing Creditor’s affidavit, she does not recall having received payment of the said cost order, but the default judgment was not reinstated.

16Settlement conferences in the Small Claims Court action were held on February 20, 2020, and June 14, 2021, during which time the parties were ordered to complete their documentary disclosure before setting the matter down for trial. The Opposing Creditor’s affidavit states that the Bankrupt failed to provide his documents, and that, at a further settlement conference held on October 21, 2021, the Small Claims Court ordered the matter be set down for trial and that the Bankrupt pay $100.00 in costs. The Opposing Creditor states that the said cost order was never paid.

17On August 9, 2022, the Small Claims Court struck the Bankrupt’s defence and granted default judgment to the Opposing Creditor in the amount of $25,000.00 plus interest and costs.

18The Bankrupt then made an assignment in bankruptcy on August 25, 2022.

19Copies of the pleadings in the Small Claims Court proceeding were not included with the Opposing Creditor’s affidavit.

The Bankrupt’s Cross-examination

20The Bankrupt was taken through the history of the Small Claims Court proceeding, about which there was little dispute.

21The Bankrupt was also directed to the Trustee’s Claims Register which showed that, of the Bankrupt’s total admitted creditors’ claims of $39,647.08, the Opposing Creditor’s admitted claim comprised $31,168.42 of that amount. That represented approximately 78.6 per cent of the total admitted claims. The two other proven claims shown on the Claims Register were $3,903.91 from BMO Financial Group and $4,574.85 from CIBC.

22When asked if he considered options other than making an assignment in bankruptcy, the Bankrupt said that he did so and proceeded with the option that he thought was right.

23The Bankrupt was, at one time employed, as a real estate agent and has worked off and on as a contractor. He is currently employed as a contractor doing residential construction work for a friend. He has no standard work hours and is paid by the job. Payments from his employment are made by cash, cheque or e-transfer. He stated that about a third of his remuneration is received in cash. His income in 2023 was approximately $24,000.00 and in 2024 was approximately $28,000 (the Trustee confirmed the amounts based on the 2023 and 2024 income tax filings to be $24,175.00 and $28,490.00, respectively).

24The Bankrupt currently lives with his parents in Grimsby. He makes some payments to his parents to cover household expenses, but the amounts are not clear. He stated that he has not taken on any debt. His expenses consist of cell phone, insurance, vehicle costs and living expenses.

25The Bankrupt stated that he is in good health and does not suffer from any mental or physical issues which limit his ability to work. His current full-time employment is the contracting work described above, but it is not steady work. He stated that his work is dependent on when his employer/friend calls him in for work. He also stated that he has looked for steady work in the past.

26The Bankrupt owns a 2013 Hyundai Elantra motor vehicle which he purchased in May 2025. He sold his previous vehicle, a Chevrolet Equinox for $3,000.00. He currently banks at The Toronto-Dominion Bank.

The Case Law

27Counsel for the Opposing Creditor drew several cases to my attention, all of which I have reviewed and will briefly discuss below.

28At paragraph 1 of Re Crowley, 1984 5444 (NS SC), 1984 CarswellNS 25 (NSSC), the Court referenced the following quote from the Supreme Court of Canada decision in Indust. Accept. Corp. v. Lalonde, [1952] S.C.R. 109:

“The purpose and object of the Bankruptcy Act [now the Bankruptcy and Insolvency Act (the “BIA”)] is to equitably distribute the assets of the debtor and to permit of his rehabilitation as a citizen, unfettered by past debts. The discharge, however, is not a matter of right and the provisions of ss. 142 and 143 [now ss. 172 and 173 of the BIA] plainly indicate that in certain cases the debtor should suffer a period of probation. The penalty involved in the absolute refusal of discharge ought to be imposed only in cases where the conduct of the debtor has been particularly reprehensible, or in what have been described as extreme cases. The conduct of the debtor in this case, while not sufficient, with great respect, to justify the absolute refusal, does justify his discharge only subject to the imposition of terms.

29Recognising the difficulty created by those two conflicting themes, the Court in Crowley provided the following summary of the principles to be applied by the Court on a bankruptcy discharge hearing:

6 First, each case must be decided on its own facts. That statement has been made in countless cases. Re Gigault (1981), 37 C.B.R. (N.S.) 119 (Ont. C.A.), is but one. That is a simplistic statement but nevertheless very true, as is evident from a reading of the cases. This is so because s. 142 of the Bankruptcy Act provides no guidance for the exercise of the judge’s discretion except that he must refuse an absolute discharge if a s. 143 fact is proven against the bankrupt. The court must look carefully at the causes of the bankruptcy.

7 Second, in considering the application for discharge, the court must have regard to not only the interests of the bankrupt and his creditors but also to the interest of the public: Re Sceptre Hardware Co., 1922 365 (SK KB), 3 C.B.R. 734, [1923] 1 W.W.R. 966, [1923] 1 D.L.R. 1201 (Sask.). This concept was well stated by Wetmore L.J.S.C., in Re Abbott; Abbott v. Royal Bank of Can. (1983), 1983 592 (BC SC), 50 C.B.R. (N.S.) 182, 48 B.C.L.R. 387 (S.C.), where he said [p. 184], “The court must always balance the public interest in commercial morality with its interest in the re-establishment of the debtor”.

8 Third, if, as is usually the case, the assets of the bankrupt are not of a value equal to 50 cents in the dollar of the bankrupt’s unsecured liabilities, the onus of proving that this fact arose from circumstances for which the bankrupt cannot justly be held responsible is on the bankrupt: Re Lougheed, 1939 513 (BC SC), 54 B.C.R. 428, 21 C.B.R. 180, [1940] 1 W.W.R. 31.

9 Fourth, the court is not bound by the trustee’s report but it is prima facie evidence with respect to the facts contained therein: Re Hoerner, Williamson & Co. (1925), 5 C.B.R. 613 (C.S. Que.). The trustee’s report should be carefully considered by the court. The trustee should be in attendance at the discharge hearing so that he can be called by either the bankrupt or a party opposed to the application to explain the basis for his conclusions, be they favourable or unfavourable to the bankrupt. Pursuant to s. 140(5) of the Act the statements in his report to the court are prima facie evidence but often no reasons are given for the opinions expressed. For example, in the case before me the trustee’s report simply says the causes of the bankruptcy were “misfortune” and that the conduct of the debtor was not subject to censure. While the trustee was present in court, he was not called. It might have been helpful had he been cross-examined as to the “misfortune” he perceived so that the court could assess the reliability of his opinion.

10 Unless contradicted by the evidence, the court must accept the statements in the trustee’s report: Re Barrick (1980), 36 C.B.R. (N.S.) 286 (B.C.C.A.). The onus is on the party opposing the application for discharge to adduce sufficient evidence to justify the court disregarding a trustee’s report that is favourable to the bankrupt. By producing a favourable report the bankrupt has met the initial burden of proving that the fact that the assets are not equal to 50 cents in the dollar of his unsecured liabilities arose from circumstances for which he cannot justly be held responsible. It is then up to the creditor opposing to bring before the court evidence upon which the court could come to a contrary conclusion: Dawson Auto Parts Ltd. v. Dorais, 1944 230 (QC CA), [1944] R.L. 405, 26 C.B.R. 52 (C.A.).

11 Fifth, if the application for discharge is opposed, the bankrupt should be available for cross-examination: Re Hood (1975), 1975 1976 (ON HCJ), 21 C.B.R. (N.S.) 128 (Ont.).

12 Sixth, an order for discharge should only be outrightly refused if the debtor’s conduct has been “particularly reprehensible, or in ... extreme cases”. What is meant by this statement in Indust. Accept. Corp. v. Lalonde [at p. 200] is that only rarely will there be an outright refusal of a discharge but rather the court will consider one of the other alternatives of suspension or attaching conditions to the discharge where an absolute discharge cannot be granted because a s. 143 fact has been proven unless the debtor’s conduct has been particularly reprehensible or in extreme cases.

13 Seventh, in considering if an order should be made that involves the payment of money by the bankrupt as a condition of his discharge, the court must bear in mind that he is entitled to have available for the maintenance of himself and his family a reasonable amount out of his after-acquired income: Clarkson v. Tod, 1934 5 (SCC), [1934] S.C.R. 230, 15 C.B.R. 253, [1934] 2 D.L.R. 316; Re Bayliss and Doerksen (1982), 40 C.B.R. (N.S.) 16 (Ont. H.C.). Accordingly, it is generally necessary for the court to have before it evidence of the bankrupt’s income and living expenses so the court’s discretion can be rationally exercised.

14 Eighth, the court does not view with favour assignments made to avoid paying a large claim of a single judgment creditor where judgment was obtained as a result of the discreditable conduct of the debtor. Under such circumstances, the courts have generally imposed a condition that the bankrupt consent to judgment in a partial amount of the claim: Kozack v. Richter, supra. This approach has most recently been followed by the Ontario Court of Appeal in Re Gigault, supra, and Re Balson (1982), 46 C.B.R. (N.S.) 319. In the Gigault case, the judge who heard the application in the first instance had required as a condition of discharge that the bankrupt consent to judgment in a very nominal amount and in the Balson case an absolute discharge had been granted. The Ontario Court of Appeal in both cases imposed meaningful payments as a condition of discharge.

15 Ninth, where a bankrupt takes a reasonable risk in embarking on a new adventure which fails because of economic factors over which he has no control, the bankrupt has satisfied the onus under s. 143(1)(a) of proving that the fact that his assets were not of a value equal to 50 cents in the dollar arose from circumstances for which he cannot justly be held responsible: Re Bayliss and Doerksen, supra.

16 Tenth, the Act provides no guidelines for the exercise by the judge of his discretion whether to suspend or impose conditions where a factor mentioned in s. 143 is proven. The discretion of the judge is very broad and should not be interfered with on appeal unless the judge, in arriving at his decision, has omitted the consideration of or misconstrued some facts or violated some principle of law: Indust. Accept. Corp. v. Lalonde, supra.

30Another case to which the Opposing Creditor referred was Kozak v. Richter, 1973 166 (SCC), [1974] S.C.R. 832. In that case, the respondent was a wage earner and person of modest means with a large family who was found liable to pay damages to the appellant for injuries suffered in a motor vehicle collision. The damages and costs awarded were approximately $14,000.00. The respondent made an assignment in bankruptcy after his unsuccessful appeal of the judgment. At the bankrupt’s discharge hearing, his discharge was suspended for three months. On appeal, the Court of Appeal varied the order and granted the discharge on the condition that the bankrupt consent to judgment against him for $1,800.00 payable in $50.00 monthly instalments. On appeal to the Supreme Court of Canada, the Court noted that there was a finding of “wilful and wanton misconduct” against the respondent in the motor vehicle collision action. Consequently, the Supreme Court increased the amount payable by the bankrupt to $7,200.00, being approximately half of the judgment.

31The Opposing Creditor also referred to the Ontario Court of Appeal decision in Re Gigault, (1981) 37 C.B.R. (N.S.) 119 in which the debtor made an assignment in bankruptcy to avoid paying a judgment of $9,245.00. Citing the Kozak case, the Court stated it “does not regard with favour the filing of an assignment in bankruptcy for the purposes of getting rid of a judgment such as that held by the appellant.” (at para. 6) The initial discharge order requiring the bankrupt to pay $600.00 in monthly instalments of $50.00 was found to be “so inordinately low as to constitute an error in principle.” (at para. 6). Consequently, the Court increased the amount payable to $5,000.00 at the rate of $100.00 per month.

32This Court was also referred to Re Ross, 2014 SKQB 52, in which the debtor was found to have made an assignment in bankruptcy to avoid paying a judgment for defamation. The judgment, in the amount of $75,000.00 plus costs of $10,000.00, comprised approximately 99% of the proven claims against the bankrupt’s estate. The Court in that case stated that the courts have tended to give less weight to the bankrupt’s financial means when determining the appropriate amount for payment in cases where the assignment in bankruptcy was made to avoid paying a judgment. The Court also noted that in such circumstances, in general, there is a “strong trend to require the bankrupt to make a payment that will provide a judgment creditor with a payment for 50% of the judgment debt.” (at para. 25). Furthermore, where significant payment orders are made, the courts have adjusted the monthly payment amount to ensure that the bankrupt was able to make the payment. In conclusion, the Court ordered that the Bankrupt be required to pay the amount of $34,000.00 at the rate of $200.00 per month, subject to other conditions.

33The final case referred to by the Opposing Creditor was Re Elford, 2017 ABQB 433 in which the Royal Bank of Canada (“RBC”) successfully defended a claim brought against it by the bankrupt prior to his bankruptcy. RBC was awarded $200,000 in costs and almost $5,000 in respect of its counterclaim. The bankruptcy occurred following the defeat of the proposal made by the bankrupt to his creditors. RBC sought an order that the bankrupt be required to pay $102,517.90, being 50% of the award granted to it in the previous proceedings. The Court in that case ordered the bankrupt to pay $50,000.00 and asked the trustee and the opposing creditor to try to agree on the monthly payments, failing which, they could return to the court to resolve the issue.

The Bankrupt’s Submissions

34The Bankrupt’s submissions were brief. He stated that the cases cited by the Opposing Creditor are different than his case. He asked the Court to consider the fact that he is currently living with his parents because of his circumstances. He wants to find a place of his own to live. He wants to improve his credit score. He asks the Court to take all of that into consideration and allow him to move on.

Disposition

35 Subsection 172(2) of the BIA states:

The court shall, on proof of any of the facts referred to in section 173, which proof may be given orally under oath, by affidavit or otherwise,

(a) refuse the discharge of a bankrupt;

(b) suspend the discharge for such period as the court thinks proper; or

(c) require the bankrupt, as a condition of his discharge, to perform such acts, pay such moneys, consent to such judgments or comply with such other terms as the court may direct.

36 Subsection 173(1)(a) of the BIA states:

173(1) The facts referred to in section 172 are:

(a) the assets of the bankrupt are not of a value equal to fifty cents on the dollar on the amount of the bankrupt’s unsecured liabilities, unless the bankrupt satisfies the court that the fact that the assets are not of a value equal to fifty cents on the dollar on the amount of the bankrupt’s unsecured liabilities has arisen from circumstances for which the bankrupt cannot justly be held responsible;

37Based on the evidence before this Court, the assets of the Bankrupt are not of a value equal to fifty cents on the dollar on the amount of his unsecured liabilities. The Bankrupt has not put forward any evidence to satisfy me that such fact has arisen from circumstances for which the Bankrupt cannot justly be held responsible.

38The Opposing Creditor obtained a default judgment against the Bankrupt. The Bankrupt succeeded in setting the judgment aside but for reasons unknown did not comply with the orders of the Small Claims Court, which resulted in his defence being struck and judgment being issued against him once again. Though the Bankrupt stated that he considered options other than bankruptcy, there is no evidence that he made any attempt to resolve the outstanding judgment with the Opposing Creditor, which judgment represented the single largest debt he owed at the time. Instead, just 16 days after the judgment was issued the second time, he made an assignment in bankruptcy.

39I find, on these facts, that the Bankrupt’s intention in making the assignment was to defeat the judgment of the Opposing Creditor. Therefore, I find that the facts of subsection 173(1)(a) of the BIA has been proven.

40The Opposing Creditor has also opposed the Bankrupt’s discharge on the grounds set out in subsections 173(1)(d) and (e). The Opposing Creditor’s affidavit provides some details about her claim against the Bankrupt. However, the pleadings in the Small Claims Court proceeding were not put before this Court, and therefore, this Court does not know what specific allegations were made against the Bankrupt in that proceeding and what allegations the Bankrupt was deemed to have admitted because of his default. Nevertheless, though the Bankrupt had the opportunity to defend the Small Claims Court proceeding, he failed to do so. Furthermore, he provided no evidence to this Court about what he did with the pre-payment he received from the Opposing Creditor for the work he was supposed to do, nor did he provide any explanation about why he never completed the work he was hired to do.

41Therefore, I am of the view that the Bankrupt “failed to account satisfactorily for any loss of assets or for any deficiency of assets to meet (his) liabilities” within the meaning of subsection 173(1)(d) of the BIA. Furthermore, I find that the Bankrupt “has brought on, or contributed to, the bankruptcy by…culpable neglect of (his) business affairs” within the meaning of subsection 173(1)(e) of the BIA.

42Having found the facts set out in subsections 173(1)(a), (d) and (e) proven, the Bankrupt is not entitled to an absolute discharge, but I am prepared to grant him a conditional discharge.

43To the Bankrupt’s credit, he has complied with his obligations to the Trustee. However, I am not bound by, nor will I follow all the Trustee’s recommendations.

44Having found that the Bankrupt’s intention in filing an assignment in bankruptcy was to defeat the judgment of the Opposing Creditor, and having considered the cases referred to above, I am persuaded that the Bankrupt should be required to pay an amount to the Trustee as a condition of him obtaining a discharge.

45According to his 2023 and 2024 income tax returns, the Bankrupt has not earned a significant amount of money. He worked as a real estate agent at one time and is current working as a contractor for a friend, but because he works only when his friend calls him to do a job, the work is not steady. Nevertheless, despite having previously looked for steady work, I am not convinced that he has made any serious and concerted efforts to do so. He appears to have a marketable skill and he stated that he does not suffer from any physical or mental impairments that would limit his employability. In any case, despite the Bankrupt’s current modest financial circumstances, based on the Ross decision, I give less weight to his financial means in determining the appropriate amount the Bankrupt is required to pay.

46The bankrupts in the Kozack, Gigault, and Ross cases referred to above were ordered to pay approximately 50 per cent, or slightly less, of the judgments obtained against them as a condition of their respective discharges. In each of those cases, the conduct of the bankrupts as determined by the Court which rendered the judgments seemed to be a significant factor in determining the amounts they were required to pay. In Kozak, there was a finding of “wilful and wanton misconduct” on the part of the bankrupt. In Gigault, the judgment arose because of the bankrupt’s misrepresentation. In Ross, the judgment was for damages for defamation.

47In this case, the Opposing Creditor’s claim against the Bankrupt which resulted in the judgment was based on a breach of contract. Once again, the pleadings in the Small Claims Court proceeding were not before this Court, and therefore, I do not know what specific allegations were made against the Bankrupt and I do not know what allegations he was deemed to have admitted because of his default. The Opposing Creditor’s affidavit states that she pre-paid the Bankrupt for the work to be done and the Bankrupt failed to do the work. Although the Opposing Creditor’s claim is serious, and the Bankrupt’s conduct toward the Opposing Creditor is concerning, the evidence does not show that the Bankrupt’s conduct rises to the same level as those of the bankrupts in the cases cited by the Opposing Creditor. Therefore, I am not inclined to order the Bankrupt to pay as high percentage as were ordered in those cases.

48Nevertheless, having regard to the fact that the Courts do not look favourably upon individuals using the BIA to escape liability from judgments obtained against them, the need to balance the rehabilitation of Bankrupt with the interest of the public, and the principles set out in the cases referred to above, the amount should not be insignificant, but it should also not financially cripple the Bankrupt.

49Therefore, I am of the view that the Bankrupt is entitled to be discharged from bankruptcy conditional upon the payment of the sum of $10,000.00. I encourage the Opposing Creditor and the Trustee to try to negotiate agreeable payment terms, failing which, the parties may contact the Court office to arrange for a virtual case conference before me to determine the issue.

50A further condition is that the Bankrupt shall provide an undertaking to the Trustee not to incur any unsecured debt for a period of five years.