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

Act current to 2020-07-28 and last amended on 2019-11-01. Previous Versions

PART IVProperty of the Bankrupt (continued)

Stay of Proceedings (continued)

Marginal note:Stay of proceedings — consumer proposals

  •  (1) Subject to subsections (2) to (4) and sections 69.4 and 69.5, on the filing of a consumer proposal under subsection 66.13(2) or of an amendment to a consumer proposal under subsection 66.37(1) in respect of a consumer debtor, no creditor has any remedy against the debtor or the debtor’s property, or shall commence or continue any action, execution or other proceedings, for the recovery of a claim provable in bankruptcy until

    • (a) the consumer proposal or the amended consumer proposal, as the case may be, has been withdrawn, refused, annulled or deemed annulled; or

    • (b) the administrator has been discharged.

  • Marginal note:Exception

    (2) Subsection (1) does not apply where the consumer proposal, other than an amendment to a consumer proposal referred to in section 66.37, is filed within six months after the filing of a previous consumer proposal in respect of the same debtor.

  • Marginal note:Idem

    (3) Subsection (1) does not apply where an amendment to a consumer proposal is filed within six months after the filing of a previous amendment to the same consumer proposal.

  • Marginal note:Secured creditors

    (4) Subject to sections 79 and 127 to 135 and subsection 248(1), the filing of a consumer proposal under subsection 66.13(2) does not prevent a secured creditor from realizing or otherwise dealing with his security in the same manner as he would have been entitled to realize or deal with it if this section had not been passed, unless the court otherwise orders, but in so ordering the court shall not postpone the right of the secured creditor to realize or otherwise deal with his security, except as follows:

    • (a) in the case of a security for a debt that is due at the date of the approval or deemed approval of the consumer proposal or that becomes due not later than six months thereafter, that right shall not be postponed for more than six months from that date; and

    • (b) in the case of a security for a debt that does not become due until more than six months after the date of the approval or deemed approval of the consumer proposal, that right shall not be postponed for more than six months from that date, unless all instalments of interest that are more than six months in arrears are paid and all other defaults of more than six months standing are cured, and then only so long as no instalment of interest remains in arrears or defaults remain uncured for more than six months, but, in any event, not beyond the date at which the debt secured by the security becomes payable under the instrument or act, or law, creating the security.

  • Marginal note:Exception

    (5) No order may be made under subsection (4) if the order would have the effect of preventing a secured creditor from realizing or otherwise dealing with financial collateral.

  • 1992, c. 27, s. 36
  • 1997, c. 12, s. 64
  • 2004, c. 25, s. 43(E)
  • 2007, c. 29, s. 95

Marginal note:Stays of proceedings — bankruptcies

  •  (1) Subject to subsections (1.1) and (2) and sections 69.4 and 69.5, on the bankruptcy of any debtor, no creditor has any remedy against the debtor or the debtor’s property, or shall commence or continue any action, execution or other proceedings, for the recovery of a claim provable in bankruptcy.

  • Marginal note:End of stay

    (1.1) Subsection (1) ceases to apply in respect of a creditor on the day on which the trustee is discharged.

  • Marginal note:Secured creditors

    (2) Subject to sections 79 and 127 to 135 and subsection 248(1), the bankruptcy of a debtor does not prevent a secured creditor from realizing or otherwise dealing with his or her security in the same manner as he or she would have been entitled to realize or deal with it if this section had not been passed, unless the court otherwise orders, but in so ordering the court shall not postpone the right of the secured creditor to realize or otherwise deal with his or her security, except as follows:

    • (a) in the case of a security for a debt that is due at the date the bankrupt became bankrupt or that becomes due not later than six months thereafter, that right shall not be postponed for more than six months from that date; and

    • (b) in the case of a security for a debt that does not become due until more than six months after the date the bankrupt became bankrupt, that right shall not be postponed for more than six months from that date, unless all instalments of interest that are more than six months in arrears are paid and all other defaults of more than six months standing are cured, and then only so long as no instalment of interest remains in arrears or defaults remain uncured for more than six months, but, in any event, not beyond the date at which the debt secured by the security becomes payable under the instrument or law creating the security.

  • Marginal note:Exception

    (2.1) No order may be made under subsection (2) if the order would have the effect of preventing a secured creditor from realizing or otherwise dealing with financial collateral.

  • (3) [Repealed, 2012, c. 31, s. 418]

  • 1992, c. 27, s. 36
  • 2005, c. 3, s. 14, c. 47, s. 62
  • 2007, c. 29, s. 96, c. 36, s. 36
  • 2012, c. 31, s. 418

Marginal note:Stay of proceedings — directors

  •  (1) Where a notice of intention under subsection 50.4(1) has been filed or a proposal has been made by an insolvent corporation, no person may commence or continue any action against a director of the corporation on any claim against directors that arose before the commencement of proceedings under this Act and that relates to obligations of the corporation where directors are under any law liable in their capacity as directors for the payment of such obligations, until the proposal, if one has been filed, is approved by the court or the corporation becomes bankrupt.

  • Marginal note:Exception

    (2) Subsection (1) does not apply in respect of an action against a director on a guarantee given by the director relating to the corporation’s obligations or an action seeking injunctive relief against a director in relation to the corporation.

  • Marginal note:Resignation or removal of directors

    (3) Where all of the directors have resigned or have been removed by the shareholders without replacement, any person who manages or supervises the management of the business and affairs of the corporation shall be deemed to be a director for the purposes of this section.

  • 1997, c. 12, s. 65

Marginal note:Court may declare that stays, etc., cease

 A creditor who is affected by the operation of sections 69 to 69.31 or any other person affected by the operation of section 69.31 may apply to the court for a declaration that those sections no longer operate in respect of that creditor or person, and the court may make such a declaration, subject to any qualifications that the court considers proper, if it is satisfied

  • (a) that the creditor or person is likely to be materially prejudiced by the continued operation of those sections; or

  • (b) that it is equitable on other grounds to make such a declaration.

  • 1992, c. 27, s. 36
  • 1997, c. 12, s. 65

Marginal note:Non-application of certain provisions

  •  (1) Sections 69 to 69.31 do not apply in respect of a claim referred to in subsection 121(4).

  • Marginal note:No remedy, etc.

    (2) Notwithstanding subsection (1), no creditor with a claim referred to in subsection 121(4) has any remedy, or shall commence or continue any action, execution or other proceeding, against

    • (a) property of a bankrupt that has vested in the trustee; or

    • (b) amounts that are payable to the estate of the bankrupt under section 68.

  • 1997, c. 12, s. 65

Marginal note:No stay, etc., in certain cases

 Despite anything in this Act, no provision of this Act shall have the effect of staying or restraining, and no order may be made under this Act staying or restraining,

  • 2001, c. 9, s. 574

Marginal note:Provincial legislation

 Except for paragraphs 69(1)(c) and (d) and 69.1(1)(c) and (d), sections 69 to 69.3 do not affect the operation of any provision of provincial legislation that has a similar purpose to subsection 224(1.2) of the Income Tax Act, or that refers to that subsection, to the extent that it provides for the collection of a sum, and of any related interest, penalties or other amounts, where the sum

  • (a) has been withheld or deducted by a person from a payment to another person and is in respect of a tax similar in nature to the income tax imposed on individuals under the Income Tax Act, or

  • (b) is of the same nature as a contribution under the Canada Pension Plan if the province is a province providing a comprehensive pension plan as defined in subsection 3(1) of the Canada Pension Plan and the provincial legislation establishes a provincial pension plan as defined in that subsection,

and for the purpose of this section, the provision is, despite any Act of Canada or of a province or any other law, deemed to have the same effect and scope against any creditor, however secured, as subsection 224(1.2) of the Income Tax Act in respect of a sum referred to in paragraph (a), or as subsection 23(2) of the Canada Pension Plan in respect of a sum referred to in paragraph (b), and in respect of any related interest, penalties or other amounts.

  • 1992, c. 27, s. 36
  • 2000, c. 30, s. 147
 
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