Hebert (Re)

Hebert (Re)

The trustee failed to properly monitor payments and detect multiple NSF cheques for approximately a year and accepted payments after default without notifying creditors or obtaining court approval; although creditors ultimately received full payment and interim distributions mitigated direct prejudice, the trustee's...

Source-derived case information.

Citation
2015 BCSC 1646
Parties
Debtor/proponent: Joyce Arlene Hebert; Trustee: Trustee; Regulator: Office of the Superintendent of Bankruptcy
Court
Supreme Court of British Columbia
Jurisdiction
Canada
Judgment Date
8 July 2015
Procedural Posture
Bankruptcy Proposal / Taxation of Trustee's Account (assessment)
Outcome
Trustee's account partially reduced
Legal Topics
Trustee Fees, Proposal Default, Statutory Duties, Fee Reduction, Taxation of Accounts, Notification Requirements
Source Language
english
Bankruptcy and Insolvency Civil Procedure Trustee Administration Trustee Fees Proposal Default Statutory Duties Fee Reduction Taxation of Accounts +1 more

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Parties

Joyce Arlene Hebert

Debtor/proponent

Trustee

Trustee

Office of the Superintendent of Bankruptcy

Regulator

Procedural Posture

Bankruptcy Proposal / Taxation of Trustee's Account (assessment)

Legal Issues

  1. 1 Whether the trustee failed to monitor payments and notify creditors after defaults on a Division I proposal
  2. 2 Whether the trustee was authorized under the BIA to accept payments after a default without creditor approval or court application
  3. 3 Whether an inordinate delay in preparing the statement of receipts and disbursements warrants a fee reduction

Ratio Decidendi

The trustee failed to properly monitor payments and detect multiple NSF cheques for approximately a year and accepted payments after default without notifying creditors or obtaining court approval; although creditors ultimately received full payment and interim distributions mitigated direct prejudice, the trustee's misconduct and inordinate delay in finalizing accounts undermined the integrity of the insolvency system and justified a discretionary fee reduction of $800 (20% of the $4,000 improperly collected).

Court Disposition

Trustee's account partially reduced

Orders

  • Reduce trustee's fees by $800 (20% of the $4,000 improperly collected)