Bankruptcy and Insolvency Act (R.S.C., 1985, c. B-3)

Act current to 2016-05-12 and last amended on 2015-02-26. Previous Versions

Marginal note:Security for unpaid wages, etc. — receivership
  •  (1) The claim of a clerk, servant, travelling salesperson, labourer or worker who is owed wages, salaries, commissions or compensation by a person who is subject to a receivership for services rendered during the six months before the first day on which there was a receiver in relation to the person is secured, as of that day, to the extent of $2,000 — less any amount paid for those services by a receiver or trustee — by security on the person’s current assets that are in the possession or under the control of the receiver.

  • Marginal note:Commissions

    (2) For the purposes of subsection (1), commissions payable when goods are shipped, delivered or paid for, if shipped, delivered or paid for during the six-month period referred to in that subsection, are deemed to have been earned in those six months.

  • Marginal note:Security for disbursements

    (3) The claim of a travelling salesperson who is owed money by a person who is subject to a receivership for disbursements properly incurred in and about the person’s business during the six months before the first day on which there was a receiver in relation to the person is secured, as of that day, to the extent of $1,000 — less any amount paid for those disbursements by a receiver or trustee — by security on the person’s current assets that are in the possession or under the control of the receiver.

  • Marginal note:Rank of security

    (4) A security under this section ranks above every other claim, right, charge or security against the person’s current assets — regardless of when that other claim, right, charge or security arose — except rights under sections 81.1 and 81.2.

  • Marginal note:Liability of receiver

    (5) If the receiver takes possession or in any way disposes of current assets covered by the security, the receiver is liable for the claim of the clerk, servant, travelling salesperson, labourer or worker to the extent of the amount realized on the disposition of the current assets and is subrogated in and to all rights of the clerk, servant, travelling salesperson, labourer or worker in respect of the amounts paid to that person by the receiver.

  • Marginal note:Claims of officers and directors

    (6) No officer or director of the person who is subject to a receivership is entitled to have a claim secured under this section.

  • Marginal note:Non-arm’s length

    (7) A person who, in respect of a transaction, was not dealing at arm’s length with a person who is subject to a receivership is not entitled to have a claim arising from that transaction secured by this section unless, in the opinion of the receiver, having regard to the circumstances — including the remuneration for, the terms and conditions of and the duration, nature and importance of the services rendered — it is reasonable to conclude that they would have entered into a substantially similar transaction if they had been dealing with each other at arm’s length.

  • Marginal note:Proof by delivery

    (8) A claim referred to in this section is proved by delivering to the receiver a proof of claim in the prescribed form.

  • Marginal note:Definitions

    (9) The following definitions apply in this section.

    compensation

    rémunération

    compensation includes vacation pay but does not include termination or severance pay. (rémunération)

    person who is subject to a receivership

    personne faisant l’objet d’une mise sous séquestre

    person who is subject to a receivership means a person any of whose property is in the possession or under the control of a receiver. (personne faisant l’objet d’une mise sous séquestre)

    receiver

    séquestre

    receiver means a receiver within the meaning of subsection 243(2) or an interim receiver appointed under subsection 46(1), 47(1) or 47.1(1). (séquestre)

  • 2005, c. 47, s. 67;
  • 2007, c. 36, s. 38;
  • 2009, c. 2, s. 356(F).
Marginal note:Security for unpaid amounts re prescribed pensions plan — bankruptcy
  •  (1) If the bankrupt is an employer who participated or participates in a prescribed pension plan for the benefit of the bankrupt’s employees, the following amounts that are unpaid on the date of bankruptcy to the fund established for the purpose of the pension plan are secured by security on all the assets of the bankrupt:

    • (a) an amount equal to the sum of all amounts that were deducted from the employees’ remuneration for payment to the fund;

    • (b) if the prescribed pension plan is regulated by an Act of Parliament,

      • (i) an amount equal to the normal cost, within the meaning of subsection 2(1) of the Pension Benefits Standards Regulations, 1985, that was required to be paid by the employer to the fund, and

      • (ii) an amount equal to the sum of all amounts that were required to be paid by the employer to the fund under a defined contribution provision, within the meaning of subsection 2(1) of the Pension Benefits Standards Act, 1985,

      • (iii) an amount equal to the sum of all amounts that were required to be paid by the employer to the administrator of a pooled registered pension plan, as defined in subsection 2(1) of the Pooled Registered Pension Plans Act; and

    • (c) in the case of any other prescribed pension plan,

      • (i) an amount equal to the amount that would be the normal cost, within the meaning of subsection 2(1) of the Pension Benefits Standards Regulations, 1985, that the employer would be required to pay to the fund if the prescribed plan were regulated by an Act of Parliament,

      • (ii) an amount equal to the sum of all amounts that would have been required to be paid by the employer to the fund under a defined contribution provision, within the meaning of subsection 2(1) of the Pension Benefits Standards Act, 1985, if the prescribed plan were regulated by an Act of Parliament, and

      • (iii) an amount equal to the sum of all amounts that would have been required to be paid by the employer in respect of a prescribed plan, if it were regulated by the Pooled Registered Pension Plans Act.

  • Marginal note:Rank of security

    (2) A security under this section ranks above every other claim, right, charge or security against the bankrupt’s assets, regardless of when that other claim, right, charge or security arose, except

    • (a) rights under sections 81.1 and 81.2;

    • (b) amounts referred to in subsection 67(3) that have been deemed to be held in trust; and

    • (c) securities under sections 81.3 and 81.4.

  • Marginal note:Liability of trustee

    (3) If the trustee disposes of assets covered by the security, the trustee is liable for the amounts referred to in subsection (1) to the extent of the amount realized on the disposition of the assets, and is subrogated in and to all rights of the fund established for the purpose of the pension plan in respect of those amounts.

  • 2005, c. 47, s. 67;
  • 2012, c. 16, s. 80.
Marginal note:Security for unpaid amounts re prescribed pensions plan — receivership
  •  (1) If a person who is subject to a receivership is an employer who participated or participates in a prescribed pension plan for the benefit of the person’s employees, the following amounts that are unpaid immediately before the first day on which there was a receiver in relation to the person are secured by security on all the person’s assets:

    • (a) an amount equal to the sum of all amounts that were deducted from the employees’ remuneration for payment to the fund;

    • (b) if the prescribed pension plan is regulated by an Act of Parliament,

      • (i) an amount equal to the normal cost, within the meaning of subsection 2(1) of the Pension Benefits Standards Regulations, 1985, that was required to be paid by the employer to the fund, and

      • (ii) an amount equal to the sum of all amounts that were required to be paid by the employer to the fund under a defined contribution provision, within the meaning of subsection 2(1) of the Pension Benefits Standards Act, 1985,

      • (iii) an amount equal to the sum of all amounts that were required to be paid by the employer to the administrator of a pooled registered pension plan, as defined in subsection 2(1) of the Pooled Registered Pension Plans Act; and

    • (c) in the case of any other prescribed pension plan,

      • (i) an amount equal to the amount that would be the normal cost, within the meaning of subsection 2(1) of the Pension Benefits Standards Regulations, 1985, that the employer would be required to pay to the fund if the prescribed plan were regulated by an Act of Parliament,

      • (ii) an amount equal to the sum of all amounts that would have been required to be paid by the employer to the fund under a defined contribution provision, within the meaning of subsection 2(1) of the Pension Benefits Standards Act, 1985, if the prescribed plan were regulated by an Act of Parliament, and

      • (iii) an amount equal to the sum of all amounts that would have been required to be paid by the employer in respect of a prescribed plan, if it were regulated by the Pooled Registered Pension Plans Act.

  • Marginal note:Rank of security

    (2) A security under this section ranks above every other claim, right, charge or security against the person’s assets, regardless of when that other claim, right, charge or security arose, except rights under sections 81.1 and 81.2 and securities under sections 81.3 and 81.4.

  • Marginal note:Liability of receiver

    (3) If the receiver disposes of assets covered by the security, the receiver is liable for the amounts referred to in subsection (1) to the extent of the amount realized on the disposition of the assets, and is subrogated in and to all rights of the fund established for the purpose of the pension plan in respect of those amounts.

  • Marginal note:Definitions

    (4) The following definitions apply in this section.

    person who is subject to a receivership

    personne faisant l’objet d’une mise sous séquestre

    person who is subject to a receivership means a person any of whose property is in the possession or under the control of a receiver. (personne faisant l’objet d’une mise sous séquestre)

    receiver

    séquestre

    receiver means a receiver within the meaning of subsection 243(2) or an interim receiver appointed under subsection 46(1), 47(1) or 47.1(1). (séquestre)

  • 2005, c. 47, s. 67;
  • 2007, c. 36, s. 39;
  • 2012, c. 16, s. 81.
 
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