The U.S. Steel Canada court-supervised restructuring and the court-supervised liquidation of Sears Canada have something in common. They both forced us to focus on the treatment of pensioners in corporate bankruptcies Canada under the Bankruptcy and Insolvency Act (R.S.C., 1985, c. B-3) (BIA) (or restructurings and liquidations under the Companies’ Creditors Arrangement Act (R.S.C., 1985, c. C-36) (CCAA)).
We previously wrote about these pension fund Canada issues and the beginning of the focus in Ottawa for the need for new legislation. My previous blogs were:
Bill S-253 passed First Reading on September 18, 2018, and Second Reading was moved on September 25, 2018. This Bill proposes to amend the BIA as well as the CCAA. It proposes to make certain that claims for unfunded obligations or solvency deficiencies of a pension are accorded priority. This is for both solvent companies and companies that would be rendered insolvent by certain payments to shareholders.. This proposed legislation likewise would change the Pension Benefits Standards Act, 1985 as well as the Pension Benefits Standards Regulations, 1985 to equip the Superintendent of Financial Institutions to identify that the financing of a pension is impaired and to recommend procedures to be taken by the employer in regard of the financing of such plan.1
Corporate bankruptcies Canada: Is Bill S-253 new?
Yes and no. In our earlier blogs, I told you about the proposals by Bloc Québécois MP Marilène Gill’s Bill, C-372 and Hamilton Mountain NDP MP Scott Duvall rose in the House of Commons for leave to introduce Bill C-384. The amendments proposed to the BIA and CCAA in those proposed Bills, to create a priority for unfunded obligations or solvency deficiencies, are pretty well the same as in Senator Eggleton’s Bill S-253.
However, Senator Eggleton’s Bill goes further. It requires a company to report to the Superintendent of Financial Institutions:
“…of any proposed or actual decision of the employer, transaction or event, including the repurchase of shares of the employer or the payment of dividends to shareholders of the employer…”
that would cause a solvency deficiency and/or render the company insolvent.
Corporate bankruptcies Canada: So what now for Bill S-253?
To become legislation, a Bill needs to initially be presented in either the Senate or the House of Commons. It needs to after that go through numerous phases in each House: 1st, 2nd and 3rd reading. After that, it has to obtain Royal Assent. No doubt there will be a lot of debating and tinkering with this Bill. It will be interesting to see if this Bill makes it all the way through, or dies before becoming legislation.
However, the picture is clear. The result of the Sears Canada dividend payments and asset liquidationis clear. Shareholders received dividends and pensioners will have to take a deep cut in their pensions. This has caught the attention of the legislators in Ottawa. It will be interesting to see if the political will is there for pensioners to be protected in Canadian insolvency cases.
Corporate bankruptcies Canada: Does your company have too much debt?
Is your company experiencing financial difficulties? If yes, call the Ira Smith Team. Our approach for each file is to create an end result where Starting Over, Starting Now takes place. This starts the minute you are at our front door.
You’re simply one phone call away from taking the necessary steps to get back to leading a healthy, balanced hassle-free life, ending the pain and stress you are feeling forever. Call Ira Smith Trustee & Receiver Inc. today for your free consultation.
If you would prefer to listen to the audio version of this average Canadian net worth 2018 blog, please scroll down to the bottom and click on the podcast.
Average Canadian net worth 2018: Introduction
According to the most recent Statistics Canada report published in 2017. The Survey of Financial Security, the median net worth of Canadian families was $295,100. That is the latest federal government official statistic we have in determining the average Canadian net worth 2018.
There’s always been talk about how a financial crisis can adversely affect your health but now a new study published in the Journal of the American Medical Association suggests that wealth shock may actually shorten your life.
Average Canadian net worth 2018: What is wealth shock?
Researchers defined wealth shock as a loss of 75% or more in financial value over two years. The average loss was about $100,000. This catastrophic financial crisis could include a drop in the value of investments or realized losses like home foreclosure. The effect was more marked if the person lost a home as part of the wealth shock, and it was more pronounced for people with fewer assets.
Average Canadian net worth 2018: How does wealth shock affect your life expectancy?
Researchers analyzed 20 years of data from the Health and Retirement Study, which checks in every other year with a group of people in their 50s and 60s and keeps track of who dies.
Wealth shock was tied to a 50% greater risk of dying
Middle-aged Americans who experienced a sudden, large economic blow were more likely to die during the following years than those who didn’t
Women were more likely than men to have a wealth shock
Wealth shock crossed socio-economic lines, affecting people no matter how much money they had to start
Average Canadian net worth 2018: This is really a story about everybody
Although this study was conducted in the U.S., “This is really a story about everybody,” said lead researcher Lindsay Pool of Northwestern University’s medical school. “Stress, delays in health care, substance abuse and suicides may contribute”, she said. North or south of the border, we’re all in equal danger. According to Dr. Alan Garber of Harvard University in an accompanying editorial, the findings suggest a wealth shock is as dangerous as a new diagnosis of heart disease. He also noted that doctors need to recognize how money hardships may affect their patients.
Average Canadian net worth 2018: Don’t wait until you’re a wealth shock statistic
Please don’t wait until you’re a wealth shock statistic. If you’ve experienced wealth shock or are experiencing financial hardship, don’t jeopardize your health. Contact a professional today.
We approach every file with the attitude that corporate or personal financial problems can be solved. That is as long as you take immediate action with the right plan. We’re just a phone call away and we can set you back on a path to financial health.
Today I am going to be telling you a story about a US corporate bankruptcy, and then a case study of our own. The purpose is to illustrate how you need to understand all the risk factors as a private small investor in making small business loans Canada.
Small business loans Canada: 1st Global Capital bankruptcy
A $283 million corporate US bankruptcy has derailed many retirement plans. It has left many investors in a financial crisis. In one case, a small inheritance was invested. In another, a cash award granted by a Court was invested. These are just two of the investor stories coming out of the US bankruptcy case of 1st Global Capital of Hallandale Beach, Florida.
1st Global Capital describes itself this way:
“1st Global Capital is an industry-leading direct funder with the professionalism, flexibility and fast turnaround you need to maximize your success. We use our years of industry experience, our funding power and our technological expertise to empower Independent Sales Organizations (ISOs) and Partner’s like you to maximize your business opportunities. Behind every 1GC deal is the expert vetting and oversight from our team of funding professionals with over 50 years of combined underwriting experience.”
Small business loans Canada: The “memorandums of indebtedness”
1st Global Capital was created 5 years ago to fund small companies. It funded loans to small businesses throughout many states in the USA. Examples of the types of businesses it funded are dining establishments, retail stores, construction businesses, healthcare, and e-commerce companies.
They raised money by issuing “memorandums of indebtedness” to people who invested with 1st Global Capital. Many used retirement savings accounts to fund their investment. 1st Global Capital used commissioned agents in many states to sell the 1st Global Capital investment opportunity. These short-term deals were supposed to pay back with interest at the end of nine months.
Small business loans Canada: The risky loan products
1st Global Capital was an alternative lender. It’s loan products included:
Merchant Cash Advances
Specialty Funding Options
Asset Based Lending
Accounts Receivable Funding
By its very nature, this was risky lending to businesses that could not obtain more traditional bank financing. The investors were wooed by promises of high returns, but I am certain they did not really understand they were making unsecured loans to a company that placed the money into risky loans.
Small business loans Canada: The small investors
Bankruptcy documents indicate greater than 4,000 1st Global Capital accounts existed across the country at the date of bankruptcy. Numerous are individual retirement accounts, each owed in between $621,000 and $922,000.
Court records indicate that 1st Global Capital stated that the cause of its bankruptcy was examinations by the Securities and Exchange Commission as well as the U.S. attorney’s office in southern Florida over alleged securities violations. As a result, the inflow of money from investors stopped when 1st Global Capital could no longer offer its memorandums. The bankruptcy files show that as a result, the company dealt with an unexpected and intense liquidity situation. The regulatory agencies state that 1st Global Capital was selling securities and the company was subject to government registration with and oversight by government regulatory agencies.
The bankruptcy records do not indicate this but I am certain that eventually, the bankruptcy trustee will report that the investment scheme was a Ponzi scheme. If the inability to take in more loans caused the company’s bankruptcy, it is obvious that they required fresh money in order to honour their existing liabilities. New investors’ money paying back older investors is a classic definition of a Ponzi scheme.
Small business loans Canada: Our very own Canadian case study
Not understanding what you are investing in is not a story unique to the United States. Let me tell you about one of our case studies from last year called Vaughan Crossings Inc (“VCI”). We were appointed by the Court as Receiver of the assets, properties and undertaking of VCI. The main asset of VCI was 5.5 acres of owned development land located at the northwest corner of Dufferin and Centre Streets in the City of Vaughan, ON. In this receivership, our main role was to sell these lands. You can find all the Court records and public information on our webpage that we set up for VCI, so I won’t go through the history of the file in this Brandon’s Blog.
The important point in this file is that the second mortgagee was a group of investors. These investors were found through the use of commissioned agents. These agents were mainly financial advisors and insurance agents. The agents made commissions to raise funds from their clients for investment in this project. Just like in the 1st Global Capital case, the investors were mainly individuals, many of whom used funds in their RRSPs to make the loan.
Small business loans Canada: The dangers of not understanding risk
During the receivership, I had the chance to speak with many investors who called in wanting to know the status of their investments. These unsophisticated people were wooed by the promise of high returns when the project was fully built out. Just like in the 1st Global Capital case, the mortgage syndicator had to cease raising funds as they were being investigated by the Financial Services Commission of Ontario. Ultimately, the mortgage syndicator went into receivership also.
The money put in by this unsophisticated investor group was secured by way of a second mortgage. The developer ran out of cash to develop the property. The mortgage syndicator was shut down. The lands were not be developed. The plan was that the mortgage syndicator was going to do another round of financing to provide construction financing, which would be in priority to the second mortgagee! The mortgage syndicator had the authority, acting as trustee of the second mortgage, to subordinate that mortgage to the construction financing. However, that never happened.
Small business loans Canada: The receivership
Without construction financing, the development project could not continue; hence our appointment as Receiver. There two mortgages against the property and numerous construction liens filed and perfected against the property. We obtained our appraisals and ran a receivership sales process. We sold the property for much more than its appraised value. The sales price repaid the construction liens and the first mortgage. However, there was very little available for the second mortgagee investors.
The promise of a high-interest rate wooed these investors. They may not have been as focussed on the safety of their capital. Unfortunately, these small investors did not understand the risks associated with this type of loan they were making. Shame on their financial advisors who sold them this investment, knowing it was not right for most of them. The financial advisors were hungry for commissions, regardless of what harm may come to their clients.
Small business loans Canada: Is your business at risk?
If your small business is having financial problems, more small business loans alone is not the answer. You must first look at all aspects of your business. First, you should look at the viability of your business.
Are there expenses that need cutting and activities that you must do that can generate more revenue? If so, perhaps we can restructure your business. You may not need a long-term small business loan. Perhaps a short-term loan to get over the immediate financial hurdle you are facing is enough.
If you are looking for ways to restructure your corporate or personal debt call Ira Smith Trustee & Receiver Inc. We understand the stress and pain your financial problems are causing you. We feel your pain and we can end it for you. Our strategy for every single business and person is to develop a result where Starting Over, Starting Now comes true, starting the minute you walk through our door. You’re just one call away from taking the necessary actions to get your debt settlement and back on the road to leading a healthy and stress-free life. Contact the Ira Smith Team today.
Canadian Centre for Policy Alternatives: Introduction
A survey released by the Canadian Centre for Policy Alternatives (CCPA) of one thousand Canadian professionals found that 20% are in precarious jobs. It’s not a surprise that job and economic insecurity is affecting professionals across the country when almost 50% of workers are living paycheque to paycheque (Canadian Payroll Association).
Canadian Centre for Policy Alternatives: Professionals are not immune
We often think that professionals armed with university degrees are immune from the economic woes that plague the rest of working Canadians. However, many professionals now find themselves in a new category of employment – precarious jobs.
A precarious job can be any type of work that is not permanent, has unpredictable income and doesn’t provide a retirement plan or sick days:
Freelance
Contract work
Part-time
Canadian Centre for Policy Alternatives: Survey results
If you think that highly educated professionals are not working in precarious jobs, think again. In today’s economy, the level of education and job security have nothing in common. According to the CCPA survey:
58% of all professionals surveyed reported their job used to be more stable
22% of professionals across Canada are now working in precarious jobs
60% of precarious professionals are women
60% of precarious workers don’t have pension plans or sick days
50% of precarious workers report that their incomes vary significantly
30% of workers in precarious jobs have a post-graduate degree
Ageism in the workplace. The highest percentage of precarious professionals fall in the 55+ category. As well, those with 10+ years in their profession are also on edge.
Professionals in precarious careers are twice as likely as those in a secure job to make less than $60,000 a year
It’s very difficult for precarious workers to plan ahead and get ahead. With an unstable income, it can be challenging to meet monthly expenses, let alone save for retirement. Many precarious workers are living off credit in between jobs just to stay above water, accumulating massive amounts of high-interest debt. After the credit cards have hit their limit, in desperation some resort to payday loans and a never-ending cycle of debt.
If you’re having trouble meeting your monthly expenses I urge you to seek professional help. Accumulating debt is not the answer to your problems. Make a no cost, no obligation appointment with Ira Smith Trustee & Receiver Inc. We’ll review your file and bring value added solutions that fit your unique issues and circumstances. Contact us today and Starting Over, Starting Nowyou’ll be able to put your financial woes behind you.
To find out more about how a consumer proposal works, you can also use the search function in our Brandon’s Blog site for any of the following phrases:
is consumer proposal worth it
consumer proposals faq
disadvantages of consumer proposal
consumer proposal vs credit counselling
how much does a consumer proposal cost
consumer proposal pros and cons
what happens after a consumer proposal
This will bring up more of our blogs on this topic.
Debt settlement vs consumer proposal Canada: The Katie Price Story
English former beauty model, reality TV star, and businesswoman, Katie Price, was a self-made success that had scooped ₤45 million after years of brilliant business transactions and plain old hard work. Unfortunately, the former glamour model will not have the ability to delight in the fruits of her work. It is said Katie is on the brink of bankruptcy having spent all her fortune.
Debt settlement vs consumer proposal Canada: Working for a pair of “knickers”
Things seem to be so bad the for the reality TV star mom. She once was paid for a social media post with one pair of slacks. Her ₤2 million Sussex estate has fallen under a state of disrepair. The swimming pool is dirty, yards are thick with growth and the tennis courts are abandoned. Katie, 40, has additionally begun marketing her horses and llamas. The ₤77,000 Audi she purchased for separated hubby Kieran Hayler for his 30th birthday celebration is also for sale.
The modelling jobs have dried up and last month she even admitted staging lewd images in Thailand with toyboy Kris Boyson. She was spotted mowing her own lawn amid claims she’s started laying off staff to stay in the black.
Debt settlement vs consumer proposal Canada: How Katie Price spent her money
Taking to Instagram, she also admitted the bailiffs had visited her house to demand £3,000 for an electricity bill. But what has the mother-of-five spent all her money on? On top of that, she’s said to have spent £120,000 on housekeepers, gardeners, and nannies – one of whom Kieran claimed to have had a year-long affair with.
Katie Price was also visited by bailiffs demanding the £3,000 she failed to pay an electrician. Her monthly heating bill apparently comes to £2,000 because she keeps it on 24-7, and her other monthly outgoings include £1,500 for twice-weekly manicures and pedicures, £1,000 on getting her hair done, £800 on massages every other day, £800 on a makeup artist, £400.
And that’s not to mention the apparent £60,000 a year she’s forking out on farm machinery such as a tractor and milking machine. She also spends on a £25,000 annual cosmetic budget.
Last Christmas she confessed ₤2,000 spent on decorations. She feared it may be her terminally ill mother Amy’s last one.
Debt settlement vs consumer proposal Canada: How Katie Price is now earning money
And while back then she generated millions from her scents, publications, reality TV show as well as x-rated shoots, nowadays her only source of work seems to be her program, My Crazy Life Now. She is determined to make back some money. Katie claimed to be intending to revive her beauty version alter ego Jordan. She also plans a release of a variety of sex playthings.
One source was quoted as saying “Katie told me when all else fails sex sells”. “It’s the way she’s taking things – she’s bringing back Jordan to fix her finances. She said that it was a no-brainer to go back to her old image.”
Debt settlement vs consumer proposal Canada: Are you in need of debt settlement?
Our strategy for every single person is to develop a result we’reStarting Over, Starting Now comes true, starting the minute you walk through our door. You’re just one call away from taking the necessary actions to get you your debt settlement and back on the road to leading a healthy and stress-free life.
There are now some new Baby Boomers characteristics. Baby Boomers are now between the ages of 54 and 72. Their new characteristics are now defined by definitely not being a one-size-fits-all group. The broad range in their ages and stages has divided them on whether or not to downsize.
Baby Boomers characteristics: The issues
Baby Boomers are healthier and working longer than previous generations; as a result, they’re not ready to sell their homes and downsize or move into retirement facilities. Others may not want to sell and downsize because of thehot housing market. And there’s a significant generational change that is preventing Baby Boomers from downsizing – their kids haven’t moved out.
Baby Boomers characteristics: Some stats
Statistics Canada reports that just over 33% of young adults, aged 20 to 34, lived with their parents in 2016. In Ontario, the number was higher – 42.1%.
According to a survey by Royal LePage:
59% of Baby Boomers are renovating rather than moving
52% of Baby Boomers say they won’t be downsizing
18% of Baby Boomers said they didn’t expect their children to leave home before the age of 30
9% of Baby Boomers said they didn’t expect their children to leave before 35
44% of Baby Boomers would bewilling to contribute up to 25% of the cost of their child’s home
Baby Boomers characteristics: Baby Boomers not downsizing
Although economists expected Baby Boomers to downsize in large numbers, that just isn’t happening. With the relatively new phenomena of adult children living at home, Baby Boomers are making the decision to renovate instead of move.
Downsizing is increasingly shifting to their 80s when they can no longer care for their homes. Although it’s a generous thought tohelp your children buy a house, Baby Boomers really need to consider whether or not that makes good financial sense for them or can potentiallyjeopardize their retirement. In addition, helping your children purchase a house that they can’t afford may do more harm than good.
Baby Boomers characteristics: Some Baby Boomers need a financial plan
If you’re in a financial quandary because you’ve helped your adult children purchase a house, or if they now find themselves with a house they can’t afford, seekprofessional help immediately.Ira Smith Trustee & Receiver Inc. is a full-service practice serving people just like you throughout the Greater Toronto Area (GTA) who need a plan forStarting Over, Starting Now. Give us acall today. We can give you peace of mind and set you on a path to debt free living.
Section 227 (4) of the Income Tax Act (Canada) (ITA) and the mirrored provisions in the Employment Insurance Act (Canada), create deemed trusts against the property of a tax debtor. When a tax debtor doesn’t remit employee source deductions or HST collections, a deemed trust Canada Revenue Agency claim arises.
Deemed Trust Canada Revenue Agency claim: Parts of the Initial Order
In every Court-supervised restructuring under the Companies’ Creditors Arrangement Act (CCAA), there are several standard provisions in the Initial Order issued by the Court. In addition to the stay of proceedings provision, there’s also the need to make sure that the insolvent company has:
sufficient debtor in possession (DIP) funding to survive the restructuring process;
the Directors incentivized to stay in their capacity; and
The normal way of achieving this is to give Court-ordered priority charges. Examples are for the borrowing authority, the Directors’ Charge and the Administrative Charge. This is so the lender, the Directors and the Court-appointed Monitor and its legal counsel know that there is a source of (re)payment.
Priority charges are made when certain affected parties may not be represented in Court. Therefore, a standard “comeback clause” is also in the standard Initial Order. This allows any affected party to make a motion before the Court to amend such Court-ordered priority charges.
Deemed Trust Canada Revenue Agency claim: The Canada North Group Inc. decision
The decision goes through a very interesting analysis as to whether a deemed trust Canada Revenue Agency claim provides Her Majesty with the ownership of the property of the company or is merely a secured interest in the property. Section 227 (4) of the Income Tax Act (Canada) and the mirrored provisions in Employment Insurance Act (Canada), create deemed trusts. Section 37(2) of the CCAA explicitly preserves their operation. Specifically, can Court-ordered priority charges under a CCAA restructuring prime the deemed trust Canada Revenue Agency claim.
Deemed Trust Canada Revenue Agency claim: Section 227(4.1) of the ITA
Section 227(4.1) of the ITA states:
“Extension of trust
(4.1) Notwithstanding any other provision of this Act, the Bankruptcy and Insolvency Act (except sections 81.1 and 81.2 of that Act), any other enactment of Canada, any enactment of a province or any other law, where at any time an amount deemed by subsection 227(4) to be held by a person in trust for Her Majesty is not paid to Her Majesty in the way and when provided under this Act, property of the person and property held by any secured creditor (as defined in subsection 224(1.3)) of that person that but for a security interest (as defined in subsection 224(1.3)) would be property of the person, equal in value to the amount so deemed to be held in trust is deemed
(a) to be held, from the time the amount was deducted or withheld by the person, separate and apart from the property of the person, in trust for Her Majesty whether or not the property is subject to such a security interest, and
(b) to form no part of the estate or property of the person from the time the amount was so deducted or withheld, whether or not the property has in fact been kept separate and apart from the estate or property of the person and whether or not the property is subject to such a security interest
and is property beneficially owned by Her Majesty despite of any security interest in such property and in their proceeds, and the proceeds of such property shall be paid to the Receiver General in priority to all such security interests.”
deemed trust canada revenue agency claim
Deemed Trust Canada Revenue Agency Claim: What is the nature of Canada Revenue Agency’s interest?
The Court raised, amongst other things, the following two questions:
What is the nature of Canada Revenue Agency’s interest?
Does the statutory secured status deemed trust Canada Revenue Agency claim elevate it above a priority charge?
Canada Revenue Agency relied on the trust provisions in the Fiscal Statutes. It argued that it holds a proprietary and not secured interest in the debtor’s property. Key to its position under its deemed trust claim is the concluding phrase in s 227(4.1) described above.
Canada Revenue Agency asserted that these words take it beyond a mere secured creditor. They stated it was so because they do not just consider the Crown to be the owner of the interest. Rather, the statute says that it is the owner. However, previous decisions in Canada have found that the deemed trust is not in truth a real one as the subject of the trust cannot be identified from the date of creation of the trust.
The Court also stated that, in principle, the deemed trust is similar to a floating charge over all the assets of the tax debtor. This is because the tax debtor is free to deal with its property. When it does, the trust releases the disposed-of property and attaches to the proceeds of sale. To find otherwise would freeze the tax debtor’s assets and prevent it from carrying on business. The Court found that this was not a result intended by Parliament.
The Court concluded that Canada Revenue Agency’s interest is a security interest, not a proprietary interest.
Deemed Trust Canada Revenue Agency Claim: Can the statutory deemed trust Canada Revenue Agency claim be raised?
The Court stated that it may seem that certain sections of the CCAA conflict with the deemed trust sections in the Fiscal Statutes on a strict reading of only the above-noted section of the ITA. That is what Canada Revenue Agency did to support its interpretation.
However, the Court went on to say that one must not read these provisions in a vacuüm. The Fiscal Statutes, the BIA, and the CCAA are part of complex legislative schemes that run concurrently. They must be read in their entire context. The aims of the statutes and Parliament’s intention kept in mind.
The Court agreed with earlier cases that the purpose of the CCAA is to let the debtor to continue to carry on business and, where possible, avoid the social and economic costs of liquidating its assets. The Court also stated that the CCAA legislation is remedial in the purest sense. It provides a means whereby the devastating social and economic effects of bankruptcy or creditor initiated termination of business operations can be avoided. It allows for a Court-supervised attempt to reorganize the financial affairs of the company.
Deemed Trust Canada Revenue Agency Claim: The Supreme Court of Canada on the Indalex deemed trust
Following the Supreme Court of Canada decision in the Indalex deemed trust decision, the Court agreed that the securing of the DIP facility is a key aspect of the debtor’s ability to attempt a workout. The harsh reality is that commercial imperatives govern the lending practices of the lenders, not the interests of the policy considerations that lead the government to legislate in its favour.
The Court also found that the priority charges aid in the restructuring process. Certain examples of such priority charges are:
Interim DIP lender’s charge providing both an incentive and guarantee to the lender the recovery of funds advanced during the restructuring.
The priority charge in favour of Directors is important. The charge keeps the captains aboard the sinking ship. Without the benefit of this charge, directors might abandon the ship.
A priority charge for administrative fees is critical to a successful restructuring. It is the only protection the Court-appointed Monitor and its legal counsel have to make sure that their bills are paid.
Further, the Court found that the Section 11.52(2) of the CCAA codifies and elaborates on priority charges. Previously, the Court used its inherent jurisdiction in granting priority charges. The Court found that this shows Parliament’s intention that secured creditors’ interests could be eroded if the Court felt the need.
Deemed Trust Canada Revenue Agency Claim: The Court’s Decision
The Court stated that Canada Revenue Agency’s position that the deemed trust Canada Revenue Agency claim cannot be primed, fails to reconcile that the goal of the Canadian insolvency restructuring regime and Parliament’s continued commitment to facilitating complex corporate CCAA restructurings, even if it requires erosion of security.
For this and the other reasons listed above, the Court determined that the CCAA gives the Court the ability to rank the priority charges ahead of the deemed trust Canada Revenue Agency claim and the resultant security interest.
Deemed Trust Canada Revenue Agency Claim: Is Your Company In Need of Financial Restructuring?
The CCAA’s aim is to help business survival and avoid the multiple traumas caused by business failure. The Ira Smith Team have decades of experience in both complex personal and corporate financial restructurings.
If you or your company cannot survive without a restructuring, contact Ira Smith Trustee & Receiver Inc. NOW for a free consultation. You are just one phone call away from getting back on the road to financial health and reducing your stress levels, Starting Over, Starting Now.
Licensed Insolvency Trustee In Toronto Ontario: Introduction
I think the most important thing is you choose the lawyer and licensed insolvency trustee (best Toronto bankruptcy trustee) in Toronto Ontario or the GTA, that you feel is right for you. There’s a lot of friends and family out there giving free advice. “Go to this person because they can get you this.”
But each case is different. You will need to have a good working relationship. This is an emotional and difficult time. If you feel like you’re sitting with a person you can’t talk to and you don’t feel comfortable then that’s not going to help you. Also, you need a firm that has the ability in-house and has avenues to instruct other experts such as your accountant.
Licensed Insolvency Trustee In Toronto Ontario: You must feel that you can work together
You must choose a cost-conscious lawyer or licensed insolvency trustee. Look for professionals that offer their realistic budget to be monitored by.
As I’ve said, it’s important you feel you can work with the person. The lawyer and licensed insolvency trustee that you choose must be separated from the emotion. However, you want them to also show you compassion. After all, this is YOUR life they are dealing with.
It’s important that you choose a lawyer and a licensed insolvency trustee that can guide you through the process and strip away the emotion.
Licensed Insolvency Trustee In Toronto Ontario: My 5 point checklist
Here is my checklist of the 5 things I believe are most important.
For a bankruptcy lawyer, check with your local Bar association.
Meet more than one
After you’ve identified a few lawyers and licensed insolvency trustees you’d like to explore further, view their websites. They should contain clearly written educational information and downloadable financial forms that you can fill out that to help you.
Then, start to schedule some appointments. Most lawyers and licensed insolvency trustees will give a free consultation. It’s helpful to go to see more than one. Not to price shop, but to gauge how comfortable you are with them and to see how their advice seems to you. This will also help you find the best Toronto bankruptcy trustee for your needs.
Passion
Look for their passion. Are they passionate about their practice? Do you feel the empathy they have for you? Do you feel they “get” you? This is how you gauge passion. A passionate professional will make sure that you are given the best advice and service. This is another way to find the best Toronto bankruptcy trustee for you.
A fee commensurate with service
Lawyers and licensed insolvency trustees are not free. The cost can vary depending on how complex your situation is and where in the country you live. If you go for the cut-rate price, you probably will not be happy with the service you will receive once you sign up. To make a reasonable amount of money in a year, the bargain basement priced shops must do a high volume. That means they cannot spend a lot of time with you.
On the other hand, don’t assume that you get the best service and result from the most expensive firm. They are the most expensive because their overhead costs are the most. It does not mean they are the best.
If it was me, I would look for the in-between price. It means they are fair to both you and themselves!
You may not need a lawyer and you will want options
Look for a licensed insolvency trustee that will discuss bankruptcy alternatives with you, even if some are not right for you. You do not want someone who just automatically tries to put you into bankruptcy.
Licensed Insolvency Trustee In Toronto Ontario: What to do if you have too much debt
I hope that you have found this vlog helpful. If you’re looking for ways to end your financial debtcallIra Smith Trustee & Receiver Inc. Our strategy for every single person is to develop a result where Starting Over, Starting Now comes true, starting the minute you stroll in the door. You’re just one call away from taking the necessary actions to get back on the road to leading a healthy and stress-free life.
More and more Canadians living paycheque to paycheque (and people are also living paycheck to paycheck in America)
The results of a new survey released by the Canadian Payroll Association were quite frankly alarming.
Almost half of people polled said they are Canadians living paycheque to paycheque and would find it difficult to meet their financial obligations if their pay was delayed by just a week resulting in their not receiving their paycheque on time
Less than 25% of respondents said they could probably not come up with $2,000 if an emergency arose within the next month
36% per cent of working Canadians said they felt overwhelmed by their level of debt
75% of working Canadians polled reporting having put aside less than 25% of the money they expect to need in retirement
35% of respondents expect to work longer
20% of employees surveyed said they will need to work four years or more than they originally expected before retiring, citing a lack of sufficient savings as the main reason
How to stop living paycheque to paycheque – behaviour modification
Although this situation is nationwide, it’s worse in Ontario, British Columbia and Atlantic Canada. Can the Canadians living paycheque to paycheque problem be cured with a change in spending habits? According to BMO’s 2015 Psychology of Savings Report, it is.
The report shows a majority of Canadians, or 88% of respondents polled, said they are willing to improve their current financial status. However, 38% also admitted that they have developed bad spending and savings habits and 31% said they’re not willing to let go of them.
Consult your Vaughan bankruptcy trustee
As professional trustees we recognize and preach the importance of a balanced budget. In fact we published two blogs on the subject.
However, this problem is not going away. In fact, seniors have now become so accustomed to living with debt that they are using it to finance their lifestyles instead of downsizing or cutting back on expenses. For the time being, seniors are not feeling the stress of carrying debt. Given that retirees and working seniors carrying debt are less likely to be taking steps to accelerate their debt repayment, the problem may very well get worse.
Seniors carrying debt not bothered by it
According to a survey conducted by Equifax for HomEquity Bank:
A number of Canadians over 75 are still dealing with a mortgage and their numbers are rising
11.3 million Canadians 55 or older have some sort of debt. Of that figure, about 1.87 million are carrying a mortgage which is up 20% in two years
Outstanding mortgage balances are up for every segment of seniors, which for the purposes of the survey was anyone over the age of 55
In the 75-and-over category, the average senior with a mortgage had $133,944 outstanding, up 11% from two years ago
Yvonne Ziomecki, senior vice-president of marketing and sales of HomEquity Bank states, “A lot of people I talk to, they just don’t really care. This is how they manage their finances and they are perfectly comfortable with it”.
Seniors carrying debt need to take action now
This can be a recipe for disaster if interest rates rise. Where is the extra income going to come from? If you’re one of the seniors carrying debt, or anyone else who is relying on credit to support their lifestyle, give the Ira Smith Trustee & Receiver Inc. Team a call before interest rates rise and while you still have options. With immediate action and the right plan we can solve your financial problems and set you on a path to debt free and stress free living Starting Over, Starting Now.
