Management and Organizational Studies 2275A/B Chapter Notes - Chapter 27: Personal Bankruptcy, Chapter 27, Secured Creditor

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 2275A/B
• Professor: Philip King

Document Summary

Businesses falter/fail even when economy"s strong poor management, lack of adequate financing, death/illness of principal, fraud, etc . 2 primary pieces of legislation that govern insolvency law in canada: bankruptcy and insolvency act (bia, companies" creditors arrangement act (ccaa) Business must try to solve financial problems through negotiated settlement: can be formal or informal. Can reach acceptable agreement between creditor and debtor through services of professional facilitator. Value of using facilitators w/ appropriate expertise is that they"re trained to identify risks and deal w/ them. Creditors may refuse to participate in negotiations or decide that it"s not in their best interests to facilitate debtor continuing to carry on business. If informal negotiations fail to produce settlement w/ creditors, need to explore more formal proceedings: seek advice from lawyer/accountant w/ insolvency expertise. If bankruptcy is best/only option, will need services of trustee in bankruptcy until bia for administering bankruptcies and proposals: trustee in bankruptcy: person who have legal responsibility.