Divisible & Non-Divisible Property

Question 1

Time of Vesting

Answer 1

Date of order (involuntary)
Date of Filing (voluntary)
Property at date of bankrupty is property that will vest

Question 2

Property (Narrow)

Answer 2

Personal rights of collection are not property
Use for 3rd parties to prevent assets being pulled from estate

Question 3

Property (Broad)

Answer 3

All rights and interests
Used against debtor to sweep all assets into estate

Question 4

Non-Divisible Property

Answer 4

Exempt property vests with Trustee before being released back to Debtor.
Cannot be liquidated -disclaimer from Trustee may allow property to be dealt with in this period
“Catch and Release”

Rmgotra v North American Assurance

Question 5

Exempt Property

Answer 5

• Held in trust for beneficiary
• Exempt under provincial law (EMJA, SFSA, RPEA) or Indian Act
• GST Credit payments
• All RRSP funds (RPEA)

s 67(1)

Question 6

Divisible Property

Answer 6

All non-exempt property, including future payments and accounts until date of discharge.

s67(1)(c)

Question 7

Trusts

Answer 7

1. If Beneficiary is bankrupt, discretionary payments by Trustee may be withheld from Trustee in Bankruptcy.
2. Automatic payments from Trustee will flow to Trustee in Bankruptcy.

Question 8

Homestead Rights

Answer 8

Trustee holds property subject to homestead rights of non-owning spouse.