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The court granted a conditional discharge requiring the bankrupt to pay outstanding surplus income and an additional sum due to his inappropriate conduct.
The bankrupt's discharge was opposed by the Trustee in Bankruptcy and an unsecured creditor, Tammy Dupuis.
The opposition was based on the bankrupt's failure to disclose a post-bankruptcy posting loan, non-compliance with surplus income obligations, and allegations of causing or contributing to bankruptcy through reckless speculation or negligence.
The court found that the bankrupt's assets were not equal to $0.50 on the dollar of unsecured liabilities, for which the bankrupt was justly responsible, and that he failed to comply with surplus income obligations.
The court ordered a conditional discharge, requiring the bankrupt to pay outstanding surplus income and an additional amount to the estate.
Conditional discharge imposed for tax‑driven bankruptcy with gambling and repeated insolvencies.
A bankrupt applied for a discharge from bankruptcy arising from substantial personal income tax debts exceeding $799,000, representing the entirety of unsecured claims.
The application was opposed by the Canada Revenue Agency, the trustee in bankruptcy, and the Office of the Superintendent of Bankruptcy on grounds including repeated insolvencies, failure to pay surplus income, non‑compliance with bankruptcy obligations, and gambling-related conduct.
The court applied the factors in s. 172.1 of the Bankruptcy and Insolvency Act governing tax‑driven bankruptcies and concluded that the debtor was not an “honest but unfortunate debtor.” Considering the debtor’s substantial post‑bankruptcy income and failure to pay taxes or surplus income, the court imposed a conditional discharge requiring payment of over $108,000 in surplus income and strict behavioural conditions related to gambling and tax compliance.
