0810363 BC Ltd. (Re)

0810363 BC Ltd. (Re)

On a balance of probabilities the court found a reasonable perception and likely actuality of conflict arising from the double retainer and the factual chronology (retention by the creditor to petition, retention by trustee, attendance at first meeting, active opposition to payment of the mortgages) which undermined...

Source-derived case information.

Citation
2012 BCSC 671
Parties
Secured Creditor/applicant: Kirandeep Kaur Gill; Trustee: Trustee in Bankruptcy for the estate of 0810363 BC Ltd.; Bankrupt Company: 0810363 BC Ltd.; Unsecured Creditor: 757369 BC Ltd. / Jasbir Jhajj; Counsel for 757369 BC Ltd. and Murray Jamieson LLP: Katherine Wellburn
Court
Supreme Court of British Columbia
Jurisdiction
Canada
Judgment Date
20 January 2012
Procedural Posture
Bankruptcy and Insolvency / Application in Chambers (oral Reasons)
Outcome
Application granted; Katherine Wellburn prohibited from acting for the trustee in this matter.
Legal Topics
Trustee Impartiality, Double Retainer, Perceived and Actual Conflict of Interest, Security Validity Challenges
Source Language
english
Bankruptcy Insolvency Conflict of Interest Professional Conduct Trustee Impartiality Double Retainer Perceived and Actual Conflict of Interest Security Validity Challenges

Source-derived case record

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Legal principles 3 Authorities cited 2 Party arguments 2 Amounts and remedies 4
Sign in to unlock

Parties

Kirandeep Kaur Gill

Secured Creditor/applicant

Trustee in Bankruptcy for the estate of 0810363 BC Ltd.

Trustee

0810363 BC Ltd.

Bankrupt Company

757369 BC Ltd. / Jasbir Jhajj

Unsecured Creditor

Katherine Wellburn

Counsel for 757369 BC Ltd. and Murray Jamieson LLP

Procedural Posture

Bankruptcy and Insolvency / Application in Chambers (oral Reasons)

Legal Issues

  1. 1 Whether counsel for an unsecured creditor can simultaneously act as legal adviser to the trustee in bankruptcy without creating a conflict of interest
  2. 2 Whether the double retainer creates a reasonable perception of bias that disqualifies counsel from advising the trustee
  3. 3 Whether the duties of counsel to a creditor and to a trustee are irreconcilable in the circumstances

Ratio Decidendi

On a balance of probabilities the court found a reasonable perception and likely actuality of conflict arising from the double retainer and the factual chronology (retention by the creditor to petition, retention by trustee, attendance at first meeting, active opposition to payment of the mortgages) which undermined the trustee's duty and appearance of impartiality; accordingly counsel was prohibited from acting for the trustee in this bankruptcy.

Court Disposition

Application granted; Katherine Wellburn prohibited from acting for the trustee in this matter.

Orders

  • Katherine Wellburn is prohibited from acting for the trustee in the bankruptcy of 0810363 BC Ltd.
  • No objection to Katherine Wellburn continuing to act for 757369 BC Ltd.