June 23rd, 2006 by Questions
What is the priority order of compensation of secured, unsecured and preferred creditors in a personal bankruptcy in Ontario?
June 23, 2006 at 6:59 pm, Barton Goth, GCO Inc. Bankruptcy Trustees said:
Secured creditors operate outside of the Bankruptcy and Insolvency Act and have the right to either allow payments to continue as originally contracted, or seize the vehicle and reduce their outstanding amounts from the sale proceeds.
The unsecured creditors have a list of priorities in terms of who gets paid first, they are basically as follows:1. Funeral and testamentary expenses of a deceased bankrupt; 2. Costs of administration;3. Superintendentâ€™s Levy;4. Wages, salaries, commissions of any employee (except for relatives);5. Alimony or maintenance outstanding in the year prior to bankruptcy;6. Municipal taxes; 7. Landlord for arrears of rent for a period of 3 months immediately preceding the bankruptcy and accelerated rent for a period not exceeding 3 months following the bankruptcy if expressly written into the lease and up to the maxim of the monies received from the assets on premises;
There are a few exceptions to the above so it is important you discuss these with a licensed trustee so he can discuss the various exceptions to the above.
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