Regulations amending the OPD Regulations

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Regulations Amending the Orderly Payments of Debts Regulations

Date:  July 12, 2005

To:  All OSB employees, trustees, registrars, jurists and credit managers

From:  Superintendent of Bankruptcy

Subject:  Regulations Amending the Orderly Payments of Debts Regulations

The Office of the Superintendent of Bankruptcy would like to inform you that the Regulations Amending the Orderly Payments of Debts Regulations were registered by the Clerk of the Privy Council on May 31, 2005 (SOR/2005-168) and published in the Canada Gazette, Part II on June 15, 2005 (Vol. 139, No. 12). These Regulations come into force on the day on which they were registered. A copy of these Rules is attached for your reference (annex I). You may also consult the OSB's Web site at: http://osb-bsf.ic.gc.ca or the Canada Gazette's Web site at:  http://canadagazette.gc.ca to view the amended Regulations.

The primary objective of the amendments was the addition of the term "common-law partner" to the Orderly Payment of Debts Regulations. In 2000, The Modernization of Benefits and Obligations Act (S.C. 2000, c.12) amended 68 federal statutes, including the Bankruptcy and Insolvency Act, in order to assign the same benefits and obligations to all couples who have been cohabiting in a conjugal relationship for at least one year, whether of the opposite sex or same sex. As a result, the notion of "common-law partner" was added to the Bankruptcy and Insolvency Act and the Orderly Payment of Debts Regulations have therefore been amended accordingly.

These amendments also result from the 1985 revision of the statutes of Canada, which led to a renumbering of the paragraphs in Part X of the Bankruptcy and Insolvency Act. In certain places, the Orderly Payment of Debts Regulations make reference to the provisions of the Bankruptcy and Insolvency Act. The numbers of the paragraphs so cited were never modified following the renumbering of the provisions of the Bankruptcy and Insolvency Act. The amendments rectify this situation which, as a result, will improve and facilitate the understanding of the Orderly Payments of Debts Regulations for the reader.

The Regulations also bring minor modifications to the wording of the Orderly Payment of Debts Regulations in order to harmonize them with the Bankruptcy and Insolvency Act.

Finally, the amendments consist of housekeeping corrections and clarifications which involve changes of an administrative nature. They do not impose any new restrictions or obligations.

For supplementary information on this matter, please do not hesitate to contact Josée Pilotte, Policy Analyst, by phone at (613) 948-5007, by fax at (613)948-4080 or by e-mail at pilotte.josee@ic.gc.ca

Annex 1

Vol. 139, No. 12 — June 15, 2005

Registration
SOR/2005-168 May 31, 2005

Bankruptcy and Insolvency Act

Regulations Amending the Orderly Payment of Debts Regulations

P.C. 2005-1056 May 31, 2005

Her Excellency the Governor General in Council, on the recommendation of the Minister of Industry, pursuant to section 240 (see footnote a) of the Bankruptcy and Insolvency Act (see footnote b) , hereby makes the annexed Regulations Amending the Orderly Payment of Debts Regulations.

Regulations Amending the Orderly Payment of Debts Regulations

Amendments

1. The long title of the Orderly Payment of Debts Regulations (see footnote 1) is replaced by the following: 

   ORDERLY PAYMENT OF DEBTS REGULATIONS

2. Section 1 of the Regulations and the heading before it are repealed.

3. Section 2 (see footnote 2) of the French version of the Regulations is replaced by the following: 

   2.  Dans le présent règlement, « Loi » s'entend de la partie X de la Loi sur la faillite et l'insolvabilité.

4. Subsection 5(1) of the Regulations is replaced by the following: 

   5.  (1) An affidavit of a debtor filed with the clerk in accordance with subsection 219(2) of the Act operates as an application for a consolidation order.

5. Section 6 of the Regulations is replaced by the following: 

   6.  Where a creditor is shown to be related to the debtor, the clerk may, before entering the creditor's name in the register, require an affidavit from the creditor proving the alleged debt.

6. Paragraph 16(b) of the Regulations is replaced by the following: 

   (b) where, under paragraph 233(3)(b) of the Act, the court makes an order permitting all registered creditors to proceed independently for the enforcement of their claims.

7. Section 17 of the Regulations is replaced by the following: 

   17.  An application by a debtor under subsection 233(5) of the Act to continue under a consolidation order on the grounds that the default of the debtor is due to circumstances beyond their control shall be by notice of motion.

8. Subsection 18(1) of the Regulations is replaced by the following: 

   18.  (1) A registered creditor who elects to rely on their security pursuant to section 232 of the Act shall, before relying on that security, file with the clerk an affidavit as to its value and, if the security is repossessed and sold or seized and sold, disclose to the clerk whether the proceeds received from the disposal of the security are in excess of the creditor's claim.

9. Section 18.1 (see footnote 3) of the French version of the Regulations is replaced by the following:

   18.1  Sauf indication contraire du présent règlement, tout avis exigé par la Loi ou le présent règlement est expédié par courrier ordinaire.

10. The portion of section 27 of the French version of the Regulations before paragraph (a) is replaced by the following: 

    27.  Pour l'application de la Loi et du présent règlement, on entend par « tribunal » ou « cour » :

11. Schedule I to the Regulations is amended by replacing the reference "(ss. 15, 16, 22, 23 and 26)" after the heading "SCHEDULE I" with the reference "(Sections 15, 16 and 26)".

12. Form 1 of Schedule I to the Regulations is amended by replacing the reference "(section 190(2))" after the heading "FORM 1" with the reference "(Subsection 219(2) of the Act)".

13. (1) The portion of the affidavit set out in Form 1 of Schedule I to the Regulations before section 1 is replaced by the following: 

    I, ______________, of ______________________ in the Province of ______________ make (oath or solemn affirmation) and say that: 

    (2) Sections 9 to 12 of the affidavit set out in Form 1 of Schedule I to the Regulations are replaced by the following: 

    9.  I am (a spouse, a common-law partner or single).

    10.  The income of my (spouse or common-law partner) from all sources amounts to $_______, being _______.

    11.  The take home income of my (spouse or common-law partner) is $________ after the following deductions: ________________________________________________.

    12.  The business or occupation of my (spouse or common-law partner) is that of ______________ and my (spouse or common-law partner) is employed by ______________ whose address is ______________________________.

    (3) The portion of the affidavit set out in Form 1 to the Regulations after section 15 is replaced by the following: 

    (Sworn or affirmed) before me at ________, in the Province of _________, this ______________ day of ______________, 20__.

    ________________________	______________________
    	Debtor

14. Form 1 of Schedule I to the French version of the Regulations is amended by replacing the expression "lien de parenté" and "lien de parenté avec le débiteur" with the expression "lien avec le débiteur".

15. Schedule I to the Regulations is amended by replacing the reference "(section 191(2))" after the heading "FORM 2" with the reference "(Subsection 220(2) of the Act)".

16. The note to Form 2 of Schedule I to the Regulations is replaced by the following: 

    NOTE: If the debt as acknowledged to you is secured, you may, at any time, elect to rely on your security in the manner provided for in section 232 of the Act, a copy of that section being set out below: 

    "232.  (1) A registered creditor holding security for a claim may, at any time, elect to rely on his security notwithstanding that the claim is included in a consolidation order.

    (2)  Where the proceeds from the disposal of the security referred to in subsection (1) are in excess of the registered creditor's claim, the excess shall be paid into court and applied in payment of other judgments against the debtor.

    (3)  Subsection (2) does not apply where the security is in the form of chattels exempt from seizure under any law in force in the province in which the consolidation order was issued.

    (4)  Where the proceeds from the disposal of the security referred to in subsection (1) are less than the registered creditor's claim, the creditor remains entitled to the balance of his claim.

    (5)  Subsection (4) does not apply in a case where, under the law in force in the province in which the consolidation order was issued, a creditor

    (a) who enforces his security by repossession or repossession and sale, or

    (b) who seizes and sells the security under an execution issued pursuant to a judgment obtained against the debtor in respect of the claim so secured,

    is limited in his recovery of the claim to the security so repossessed or the proceeds of the sale thereof."

    If you elect to rely on your security, you must immediately place a fair value on the goods so repossessed and notify the court of this valuation at once.

    If the value exceeds the amount owing to you, then you are ordered to pay the excess of that value upon realization as to which you are required to exercise due diligence.

17. Form 2 of Schedule I to the Regulations is amended by replacing the word "spouse" with the expression "spouse or common-law partner".

18. Form 2 of Schedule I to the French version of the Regulations is amended by replacing the expressions "lien de parenté" and "lien de parenté avec le débiteur" with the expression "lien avec le débiteur".

19. Form 3 of Schedule I to the Regulations is amended by replacing the reference "(section 192(1))" after the heading "FORM 3" with the reference "(Subsection 221(1) of the Act)".

20. Form 4 of Schedule I to the Regulations is amended by replacing the reference "(section 192(3))" after the heading "FORM 4" with the reference "(Subsection 221(3) of the Act)".

21. Form 5 of Schedule I to the Regulations is amended by replacing the reference "(sections 198, 194(1)(a) and (b), 202(2), 205(4)(d))" after the heading "FORM 5" with the reference "(Subsections 223(1), 227(1), 231(2) and 234(4) of the Act)".

22. Form 6 of Schedule I to the Regulations is amended by replacing the reference "(section 197(2))" after the heading "FORM 6" with the reference "(Subsection 226(2) of the Act)".

23. Form 7 of Schedule I to the Regulations is amended by replacing the reference "(section 204(1))" after the heading "FORM 7" with the reference "(Subsection 233(1) of the Act)".

24. Form 8 of Schedule I to the Regulations is amended by replacing the reference "(section 204(5))" after the heading "FORM 8" with the reference "(Paragraph 233(3)(b) and subsection 233(5) of the Act)".

25. Form 9 of Schedule I to the Regulations is amended by replacing the reference "(section 196)" after the heading "FORM 9" with the reference "(Section 225 and subsection 226(1.1) of the Act)".

26. Form 10 of Schedule I to the Regulations is amended by replacing the reference "(section 196)" after the heading "FORM 10" with the reference "(Section 225 and subsection 226(1.1) of the Act)".

27. Form 11 of Schedule I to the Regulations is amended by replacing the reference "(sections 198(1), 202(3), 205(4))" after the heading "FORM 11" with the reference "(Subsections 227(1), 231(3) and 234(4) of the Act)".

28. Form 12 of Schedule I to the Regulations is amended by replacing the reference "(section 201(1))" after the heading "FORM 12" with the reference "(Subsection 230(1) of the Act)".

29. Form 13 of Schedule I to the Regulations is amended by replacing the reference "(section 201(1))" after the heading "FORM 13" with the reference "(Subsection 230(1) of the Act)".

30. Form 14 of Schedule I to the Regulations is amended by replacing the reference "(section 201(2))" after the heading "FORM 14" with the reference "(Subsection 230(2) of the Act)".

31. Form 15 of Schedule I to the Regulations is amended by replacing the reference "(section 202(1))" after the heading "FORM 15" with the reference "(Subsection 231(1) of the Act)".

32. Form 16 of Schedule I to the Regulations is amended by replacing the reference "(section 202(1))" after the heading "FORM 16" with the reference "(Subsection 231(1) of the Act)".

33. Form 17 of Schedule I to the Regulations is amended by replacing the reference "(section 203)" after the heading "FORM 17" with the reference "(Section 232 of the Act)".

34. (1) The portion of the affidavit set out in Form 17 of Schedule I to the Regulations before section 1 is replaced by the following: 

    I, ______________, of ______________, in the Province of ______________, make (oath or solemn affirmation) and say that: 

    (2) The portion of the affidavit set out in Form 17 of Schedule I to the Regulations after section 4 is replaced by the following: 

    (Sworn or affirmed) before me at __________________, in the Province of ______________, this ______________ day of ______________ 20__.

    ________________________	______________________
    	Debtor

    
    

35. Form 18 of Schedule I to the Regulations is amended by replacing the reference "(section 204(5))" after the heading "FORM 18" with the reference "(Subsections 233(3) and (5) of the Act)".

36. Form 19 of Schedule I to the Regulations is amended by replacing the reference "(section 205(1))" after the heading "FORM 19" with the reference "(Subsection 234(1) of the Act)".

37. Form 20 of Schedule I to the Regulations is amended by replacing the reference "(section 205(3))" after the heading "FORM 20" with the reference "(Subsection 234(3) of the Act)".

38. The Regulations are amended by replacing the expression "19" with the expression "20" in Schedule I and II.

39. Schedule II to the English version of the Regulations is amended by replacing the expression "wife" and "wife's" with the expressions "spouse or common-law partner" and "spouse's or common-law partner's".

40. Schedule II to the French version of the Regulations is amended by replacing the expressions "conjoint" and "lien de parenté" with the expressions "époux ou conjoint de fait" and "lien avec le débiteur", with any grammatical modifications that the circumstances require.

41. The Regulations are amended by replacing references to the Bankruptcy Act with references to the Bankruptcy and Insolvency Act wherever they occur in the following provisions: 

    (a) Form 2 of Schedule I; and

    (b) Schedule II.

    COMING INTO FORCE

42. These Regulations come into force on the day on which they are registered.

Footnotes

a  S.C. 1992, c. 27, s. 88

b  S.C. 1992, c. 27, s. 2

1  C.R.C., c. 369

2  SOR/92-578

3  SOR/92-578