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Discussion – 


Discussion – 


Insolvent clients: questions and answers.


While the exceptional situation in which we are immersed has already lasted for several months, it is finally time for some to resume their activities. For others, the last few months have unfortunately forced them to restructure or cease operations.

Some of you will receive notices in the coming weeks that a client has filed for bankruptcy protection or CCAA. Although a wind of solidarity allows for great efforts of conciliation and flexibility between companies for the treatment of delays in the collection of accounts receivable, this situation reminds us of the importance of protecting ourselves further.

What to do? How to protect yourself? What are the alternatives? Here are some questions and answers to help you manage this new reality and minimize losses.

Your client has filed for legal protection or bankruptcy. You receive a notice in the mail.

Do I need to complete the proof of claim?
To be eligible for distribution, you must complete the proof of claim form sent by the trustee or monitor. You must include a copy of the invoices or a statement of account.

If you do not file a claim, governments may deny your bad debt.

Should I continue to sell to him on credit?
No. In a restructuring context, a debtor cannot increase its liabilities. You can demand to be paid on delivery.

Can I refuse to sell to him?
In very rare cases, a CCAA could require a sale without being paid right away. That said, in most cases, the question to ask is: why refuse a sale if it’s COD?

Can I cancel a contract?
No, whether the debtor restructures under the Bankruptcy and Insolvency Act or under the Companies’ Creditors Arrangement Act (C-36)

Can I retain his property?
Yes. This is the concept of a lien that applies up to the value of the property.

Should I vote?
For a proposal to be accepted, 50% + 1 of the voting creditors must vote in favor and 66% (2/3) in favor. The concept is similar in a C-36 context. A restructured company may be a loyal customer for many years, but the ultimate decision to vote is yours.

This program will also be available to non-profit organizations (NPOs) and registered charities (RCOs).

Visit our website or contact our specialist directly for all your insolvency or bankruptcy questions.


Que ce soit de revoir votre budget, d’identifier des biens que vous pourriez vendre pour vous sortir de l’endettement, de négocier des nouveaux termes de paiements avec vos créanciers ou déposer une proposition de consommateur, voire vous aider à repartir à zéro en considérant la faillite, nous vous aiderons à y voir clair. Nous vous recommanderons la meilleure solution pour vous, en toute confiance et en toute confidentialité.

À lire par la suite

How to avoid bankruptcy?

How to avoid bankruptcy?

When personal and professional problems tend to accumulate, it becomes complicated to pay off debts and the financial situation can become increasingly delicate. In this case, it is still possible not to declare bankruptcy. Find out how.

Nos appels et rencontres sont 100% confidentiels et une consultation n'affecte pas votre cote de crédit.