This course is for students who want to practise bankruptcy or commercial law – and for those who simply want a timely and challenging course that covers a key legal system underlying the Canadian and global economies. We will consider the fundamentals of business and personal bankruptcy and insolvency in Canada situated in a comparative context. Students will learn the basic concepts of “straight” bankruptcy liquidation, in which a Licensed Insolvency Trustee is appointed to sell the debtor’s assets and pay the proceeds to the creditors. For consumers, that topic includes the fresh start–the discharge of all pre-existing debt–and the identification of exempt assets. Students will also study the rehabilitation provisions, under which the debtor attempts to pay all or some part of the pre- bankruptcy debt: consumers proposals and commercial proposals and plans for businesses. Bankruptcy adjacent and out-of-court processes will also be considered. Significant attention will be given to the substance of bankruptcy laws, including the “avoiding powers” (for example, preferences and fraudulent conveyances), treatment of secured creditors, and priorities in asset distribution. The course attempts to give balanced attention to the practice realities of negotiation and leverage within a complex set of doctrinal rules and to the social and economic consequences of the bankruptcy system in both its consumer and commercial manifestations.
The goals of the course are the following:
a. To understand the fundamental problems that justify bankruptcy law;
b. To study the key features of Canadian bankruptcy legislation and how it addresses these problems;
c. To understand financial transactions that interact with bankruptcy law; and
d. To understand the realities of how bankruptcy actually works in practice.