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creditor

Once the consumer proposal has gone into effect and the debtor pays one of the creditors a cash amount without informing the other creditors, does this make the consumer proposal void?

Posted from: British Columbia

One Response to “creditor”

Barton Goth – Goth & Company Inc. -Trustee in Bankruptcy said...

What this is referred to is a fraudulent preference and it is an offense under the Bankruptcy and Insolvency Act. There are a number of things that can happen as a result of this, but you are right that it can be used to as a reason to nullify a proposal. This is not a guarantee, but it is a very serious issue and one that can definately be detrimental to the proposal itself.