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  • Consumer Proposals
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Contact a Trustee

The first step in the process is to contact a Trustee in your local BDO office. A Trustee is an individual or corporation who is licensed by the Government to administer bankruptcies and Proposals. The Trustee will inform you of the effects of a Consumer Proposal and will prepare the necessary documents to file the Consumer Proposal with the Office of the Superintendent of Bankruptcy.

Notification

Upon filing of the Consumer Proposal with the Superintendent, the Trustee will send a notice of the Proposal, together with a copy of the Consumer Proposal and some financially relevant personal information of the debtor, to all known creditors. At the time of filing a Consumer Proposal, a creditor is prohibited from instituting or continuing any legal action unless they obtain permission (leave) from the Bankruptcy Court. Interest on the amounts owing to the creditors stops accruing at the time of filing the Consumer Proposal.

Voting

The unsecured creditors will have up to forty-five days to request a meeting to vote on the Consumer Proposal. If creditors do not respond, they will be considered to have accepted the Consumer Proposal.

Unsecured creditors may request a meeting. If the unsecured creditors requesting a meeting are owed more than 25% of the total value of creditors who have responded to the Consumer Proposal, the Trustee will arrange a meeting to vote on whether to accept or reject the Consumer Proposal. At the meeting, if the majority in value of the unsecured creditors, who are voting, accept the Consumer Proposal, it will become binding on the debtor and all creditors.

When a Consumer Proposal is accepted by the creditors, it is deemed approved by the Court after fifteen days have expired, unless a court hearing to approve the Consumer Proposal is requested.

A summary of the steps in the Consumer Proposal process:

• Contact the Trustee and file the Consumer Proposal.
• The creditors vote on the acceptance of the Consumer Proposal.
• Once the Consumer Proposal is accepted, the debtor makes payments to the Trustee, who in turn makes payments to the creditors according to the terms of the Consumer Proposal.
• If the Consumer Proposal is not accepted, the debtor will have to consider other alternatives.
• If the debtor defaults in his/her payments, the Consumer Proposal will be annulled.
• Attend counselling sessions as required.
• Once the payments are completed, the Trustee issues a Certificate of Full Performance of Consumer Proposal.