How Do I Get Out Of Bankruptcy
Filing for bankruptcy is a very straight forward process. Getting a discharge is not.
A first time or a second time bankrupt will receive an "automatic" discharge, and once a person gets this discharge they are free from all of their debt. However, the trustee acts on behalf of all the creditors to ensure the integrity of the BIA is upheld before a discharge is granted.
There are a number of powers the system provides in order to ensure the integrity is upheld.
An examination is a tool that the Superintendent of Bankruptcy ("OSB), or with leave of the court the Trustee, or creditors can use to investigate the debtor. Failure to answer these questions truthfully is akin to perjury and punishable by summary conviction or a fine of up to $5,000.
The examinations don't stop at the bankrupt. Any interested person can be examined to find the truth.
Although it is difficult for a creditor to examine, a creditor can call a meeting of creditors, and ask questions there. The debtor is not under oath however. IF a creditor wants an oath he must request the examination by the OSB, or go to court.
#2 Objections to Discharge,
A creditor with a proven claim can object to the discharge of a debtor. The grounds for this to occur are based on the misconduct of the debtor or for a set of facts that are very specific under the act.
1. The debtor had assets that were of a value equal to $0.50 cents on the dollar.
2. The bankrupt has omitted to keep books of account
3. The bankrupt continued to do business while knowing himself to be insolvent.
4. The bankrupt has failed to account for loss or deficiency in his assets
5. The bankrupt has brought on his bankruptcy by rash, and hazardous speculations, unjustifiable extravagance in living or gambling.
6. Put creditors to unnecessary expense by frivolous or vexatious defense.
7. The bankrupt has made a preference to a creditor
8. Has been bankrupt or made a proposal before.
9. The bankrupt has failed to comply with a requirement to pay imposed under S.68
10. The bankrupt could have made a viable proposal
11. The bankrupt failed to perform duties imposed upon him .
So if the creditor objects to the discharge there is a hearing in the bankruptcy court, and the bankrupt will have an opportunity to state his position.
The court will have no choice if any of the above facts are proven, to give the bankrupt a conditional, suspended or refuse the discharge altogether.
The bottom line, is if you want to declare bankruptcy, be honest, and follow the guidelines of your trustee. If you are a good boy or girl, you will have your debts forgiven, and can move on with your life.
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