QUESTION [August 4, 2010]

There are laws governing business to business collections, similar to the laws regarding consumer collections.

QUESTION [July 21, 2010]

If two people of equal intelligence are given the challenge of completing a task of equal complexity, which is more likely to succeed?

QUESTION [July 7, 2010]

Although everyone knows there is no debtor’s prison in Canada, a debtor can in fact, go to jail for a debt.

QUESTION [June 16, 2010]

In Canada’s Competition Act, credit groups could be found guilty of conspiracy to eliminate or reduce competition by exchanging negative credit information that causes a “blacklist” to be created.

QUESTION [June 2, 2010]

When a consumer goes bankrupt, he is legally obligated to turn over all credit cards to the trustee.

QUESTION [May 19, 2010]

A business credit report that is factually incorrect could form the basis of a lawsuit against the reporting agency.

QUESTION [May 5, 2010]

In a consumer bankruptcy, all the following debts are not excluded from discharge. These are alimony and child support payments, student loans, fines, debts arising from fraud and income taxes.

QUESTION [April 21, 2010]

After being invited to speak at this year’s sales meeting, the agenda shows you are last to speak in the afternoon. You think, this really doesn’t matter.

QUESTION [April 7, 2010]

The outright costs of credit administration (including overhead), financing and lost opportunity costs, salaries and benefits of staff, as well as bad debts and even the minor effects of inflation can be as high as 5% per month.

QUESTION [March 17, 2010]

Business credit reporting agencies have been successfully sued for damaging credit reports.

QUESTION [March 3, 2010]

When a judgment is given by a court, assets of the debtor may be seized by the Sheriff and given to the judgment-creditor.

QUESTION [February 17, 2010]

If creditors are unsuccessful in a motion for a Bankruptcy Order (formerly Receiving Order), the creditors can be sued for damages.

QUESTION [February 3, 2010]

Having the notation on your invoice “Title and ownership of goods does not pass until goods are paid for in full” creates a security agreement.

QUESTION [January 20, 2010]

One cannot access business credit reports without consent or authorization in Canada.

QUESTION [January 6, 2010]

As per the Economic Analysis Group of the Office of the Superintendent of Bankruptcy, the repeat bankruptcy rate (more than one bankruptcy) has increased from 8.8% in 1990 to 17.2% in 2006.

QUESTION [December 16, 2009]

GST credit payments (a quarterly payment to help low income people offset the GST they pay) are exempt from seizure by a trustee in bankruptcy.

LEGAL QUESTION [December 2, 2009]

Which of the following is the document a creditor uses to begin a court case (an “action”) against a debtor?

LEGAL QUESTION [November 18, 2009]

Which of the following is not suggested as part of your company’s “best practices” credit policy with regards to current customers?

LEGAL QUESTION [November 4, 2009]

Your debtor has defaulted under the lease and your bailiff attends the premises. The premises are empty. You call your debtor, who promises that you will be paid before his company goes bankrupt. However, the next day, you get a Notice of Bankruptcy from his Trustee. You want your collateral back – what can you do?

LEGAL QUESTION [October 21, 2009]

You had a contract with a customer for the lease and maintenance of computer equipment. You delivered the equipment to your customer, and provided maintenance for six months. Your customer refused to pay your invoices; while you managed to get your equipment back, you are still owed $15,000 for unpaid invoices. What is the best court and procedure in which to bring your case?

LEGAL QUESTION [October 7, 2009]

A “bulk sale” is a sale of stock, merchandise or other assets made in the usual course of business or trade of a seller. Many debtors, in an attempt to avoid paying their creditors, attempt to sell their assets quickly in a bulk sale.

How can the Bulk Sales Act help a creditor collect debt?

LEGAL QUESTION [September 16, 2009]

If you sue a customer who defaults on a contract, and they claim “non est factum”, what does this mean?

LEGAL QUESTION [September 2, 2009]

How long is the basic limitation period for collection of a debt in Ontario?

LEGAL QUESTION [August 19, 2009]

When are penalty clauses enforceable?

LEGAL QUESTION [July 29, 2009]

An absolute discharge from bankruptcy order completely relieves a bankrupt debtor from debts incurred up to and including the debtor’s date of bankruptcy; it is, in essence, a discharge from bankruptcy with no conditions.

An absolute discharge is usually granted for first time bankrupts:

LEGAL QUESTION [July 15, 2009]

If a creditor sues a debtor, and the debtor does not defend the action within an appropriate period, the creditor can get a judgment against the debtor for the full amount of the debt - this is called a “default judgment”. Often, the debtor can apply to the Court to overturn the default judgment.

What is the best way for a creditor to prevent a Court from overturning the default judgment?

QUESTION [July 1st, 2009]

Travel agents and credit reporting agencies are the number one source of consumer complaints to government ministries.

QUESTION [June 17, 2009]

The United States bankruptcy code does not require an insolvency test for a company to enter bankruptcy proceedings. As the Canadian Bankruptcy and Insolvency Act does require one of 10 acts of bankruptcy to be committed, a profitable and solvent Canadian company owned by a U.S parent cannot be placed in bankruptcy or court protection.

QUESTION [June 3, 2009]

When a customer enters the Companies’ Creditors’ Arrangement Act, a supplier may be required to continue to sell the distressed company on the same terms and conditions as prior to the court order.

QUESTION [May 20, 2009]

When a customer is under Court Protection under the Companies’ Creditors Arrangement Act but still needs to buy from you, it is acceptable to increase your prices to try to recover some of your frozen balances.

QUESTION [May 6, 2009]

Might the following statements regarding credit groups be considered anti-competitive?

1. An agreement, expressed or implied, between members of a credit group to establish and maintain discounts, terms or conditions of sale.
2. An agreement, expressed or implied, between members of a credit group to refuse to sell or place on a COD basis a company listed as a delinquent payor of its accounts to other members of the group.
3. Discussions of delinquent accounts that lead to any uniform action on the part of the credit group members.
   

QUESTION [April 15, 2009]

In a company balance sheet, Goodwill is a derived figure that places a value on the reputation (goodwill) a company has earned

QUESTION [April 1st, 2009]

Having an incorrect customer's name could cause your lien/lawsuit to be thrown out of court:

QUESTION [March 25, 2009]

A customer who files a Notice of Intention (NOI) to Make a Proposal under Section 50.4 (8) of the Bankruptcy and Insolvency Act and fails to either file a proposal or seek an extension is deemed to have made an assignment as of the date of the filing of the NOI.

QUESTION [March 18, 2009]

Under the Bankruptcy and Insolvency Act, under certain conditions, suppliers may repossess goods sold within 30 days of the bankruptcy or receivership.

QUESTION [March 11, 2009]

All payments received from a customer within 90 days of a bankruptcy are deemed to be preferences and the trustee can demand repayment?

QUESTION [March 4, 2009]

Does a credit application signed by a buyer, office manager or other non-officer director create contract enforceability?

QUESTION [February 25, 2009]

In corporate organizations, a parent company may deplete the assets, cash in particular, from its subsidiary, without consequence:

QUESTION [February 18, 2009]

In corporate organizations, a parent company (a corporation that owns at least 50.1% of the shares of another corporation) is responsible for the debts or any obligations of its subsidiary:

LEGAL QUESTION [February 11, 2009]

ARTICLE: Can you collect interest on your delinquent accounts?

Where you and your customer agree to the payment of interest, but you fail to stipulate the rate of interest charged in the invoicing and payment terms in the contract, what is the default interest rate set provided for by the Interest Act?

LEGAL QUESTION [February 4, 2009]

ARTICLE: Can you collect interest on your delinquent accounts?

Which of the following interest rates is enforceable in Canada?

LEGAL QUESTION [January 28, 2009]

ARTICLE: Repossession upon default of your lease

You are a restaurant supplier to Darren’s, a top-flight restaurant. In May 2008, Darren, the owner, signed a three year lease with you as the sole supplier of his restaurant’s appliances and equipment. Although the first two lease payments were made on time, it is now February 2009, and Darren is 6 months behind on his payments. You want your equipment back. How much notice must you give Darren before taking steps to repossess your equipment?

LEGAL QUESTION [January 21, 2009]

ARTICLE: Opposing a discharge from bankruptcy on the basis of debtor fraud

To successfully oppose a debtor’s discharge from bankruptcy, a creditor must demonstrate to the court that the debtor had committed one or more acts referred to in the Bankruptcy and Insolvency Act as “bankruptcy facts”. Which of the following is NOT a bankruptcy fact?