Over the past year, the ebb and flow of bankruptcy filings has been an interesting one. Through 11 months, the number of bankruptcy filings has decreased from 2021, which was already at its lowest level since the 1980s.

The total number of bankruptcy filings through November stands at 346,760. Based on a recent monthly uptick in both consumer and commercial filings, we should expect the year to end with approximately 385,000, a 4% decrease from the 401,291 filings in 2021.

The U.S. Court of Appeals for the Ninth Circuit recently affirmed a bankruptcy court’s judgment in favor of a debtor who sought to avoid a judgment lien under California’s homestead exemption law.

In so ruling, the Ninth Circuit held that, when a judgment lien impairs a debtor’s state-law homestead exemption, the Bankruptcy Code requires courts to determine the exemption to which the debtor would have been entitled in the absence of the lien.

Introduction

In response to a certified question from a bankruptcy court, the Arizona Supreme Court held that a recorded judgment lien attaches to homestead property where the judgment debtor has equity in excess of the $150,000 exemption under Arizona law.

In addition, given the uncertainty of the law that prompted the certified question, the Court denied the bank’s request for attorney’s fees.

The Ontario Superior Court of Justice’s decision in Carillion Canada Inc. clarifies how the principles in Montréal (City) v. Deloitte Restructuring Inc. (Montréal) should be applied to contingent obligations that are only quantified after the debtor company files for creditor protection.

In the receivership proceedings of Distinct Infrastructure Group Inc.

On July 13, 2022, the Court of Appeal for Ontario allowed an appeal from the Order of a bankruptcy judge in Sirius Concrete Inc. (Re), 2022 ONCA 524 (Sirius), which ruled that certain funds paid by a trade creditor formed part of the bankrupt’s estate. The issue on appeal was whether a constructive trust should be imposed over certain funds due to a claim of unjust enrichment arising from alleged fraudulent misrepresentations made by the bankrupt on the eve of its bankruptcy filing.

What this means for the shareholders of a business facing insolvency

Overview

Au Québec, le droit de la consommation évolue régulièrement et la Loi sur la protection du consommateur (L.P.C.) continue de faire l’objet de plusieurs décisions des tribunaux chaque mois.

À l’occasion de la publication de ce nouveau bulletin de notre série en droit de la consommation, nous présentons les développements récents dans ce domaine sous l’angle des décisions des quelque 12 derniers mois de la Cour d’appel du Québec, qui apportent un éclairage sur des règles de la L.P.C.