April 23rd, 2009 by Questions
How can receivers and trustee be released when it`s an ongoing bankruptcy?
Posted from: Alberta
One Response to “Trustee Release”
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April 24, 2009 at 9:19 am, Barton Goth - Goth & Company Inc. -Trustee in Bankruptcy said:
While it is unclear what you mean by “released” I assume you are talking about a “trustee discharge.”
The trustee can be discharged where a bankrupt fails to comply with his duties under the Bankruptcy and Insolvency Act in a timely fashion. You do not get unlimited time to complete a bankruptcy and in situaitons where bankrupts have been uncooperative, unresponsive, or simply have delayed completion of their duties for to long, the court will discharge the trustee from the file and leave the debtor in bankruptcy.
The result of this is that the bankrupt is not protected from his debts and is left in bankruptcy with no more court protection, so their creditors will be able to attack the bankrupt for payment in full.
This is a necessary component of a bankruptcy so that those who are not taking responsiblity and working to complete their bankruptcy in a reasonable fashion cannot simply sit in bankruptcy and hide from all responsiblity.