Regulation of Consumer Transactions use to ... - LSS | Cans DB



TOC \h \z \t "Heading 1,2,Heading 2,3,Heading 3,4,Heading 4,5,Title,1" Consumer Ks & Collections PAGEREF _Toc511163452 \h 4Regulation of Consumer Transactions use to have K invalidated PAGEREF _Toc511163453 \h 4Regulation of Collections use to secure administrative penalties PAGEREF _Toc511163454 \h 4Communication PAGEREF _Toc511163455 \h 4With Debtor PAGEREF _Toc511163456 \h 4With Others PAGEREF _Toc511163457 \h 5Time of Communication PAGEREF _Toc511163458 \h 5Cost of Communication PAGEREF _Toc511163459 \h 5Legal proceedings PAGEREF _Toc511163460 \h 5Collections PAGEREF _Toc511163461 \h 5Misrepresentations PAGEREF _Toc511163462 \h 6Debt pooling PAGEREF _Toc511163463 \h 6Collection agent and bailiff fees and disbursements PAGEREF _Toc511163464 \h 6Remedies PAGEREF _Toc511163465 \h 6Criminal Prohibitions PAGEREF _Toc511163466 \h 6The Judgment PAGEREF _Toc511163467 \h 7Default Judgments PAGEREF _Toc511163468 \h 7Interest PAGEREF _Toc511163469 \h 7Limitation Periods PAGEREF _Toc511163470 \h 7Extend lifespan of judgment PAGEREF _Toc511163471 \h 7Recognition of Foreign Judgments PAGEREF _Toc511163472 \h 8Stays of Execution PAGEREF _Toc511163473 \h 8Pending Appeal PAGEREF _Toc511163474 \h 8Discretionary Stay PAGEREF _Toc511163475 \h 9Alternative: Voth Order PAGEREF _Toc511163476 \h 9Information Acquisition PAGEREF _Toc511163477 \h 10Examination in Aid of Execution PAGEREF _Toc511163478 \h 10Subpoena to Debtor PAGEREF _Toc511163479 \h 10Contempt PAGEREF _Toc511163480 \h 11Garnishment PAGEREF _Toc511163481 \h 12Criteria PAGEREF _Toc511163482 \h 12Type of Debt PAGEREF _Toc511163483 \h 12Timing: “due or accruing due” PAGEREF _Toc511163484 \h 12Conditional Debts PAGEREF _Toc511163485 \h 12Location of Debt PAGEREF _Toc511163486 \h 13Pre-Judgment Garnishment PAGEREF _Toc511163487 \h 13Availability PAGEREF _Toc511163488 \h 13Setting Aside Pre-JGO PAGEREF _Toc511163489 \h 13Should not have been given in the first place PAGEREF _Toc511163490 \h 13Imperfect Compliance PAGEREF _Toc511163491 \h 13No Full & Frank Disclosure PAGEREF _Toc511163492 \h 14Discretion PAGEREF _Toc511163493 \h 14Priority Over Garnished Funds PAGEREF _Toc511163494 \h 14Enforcement: Order Absolute PAGEREF _Toc511163495 \h 15Writ of Seizure and Sale PAGEREF _Toc511163496 \h 16What can be seized? PAGEREF _Toc511163497 \h 16Goods, Chattels, and Effects: Tangibles PAGEREF _Toc511163498 \h 16Money and Security for Money: Intangibles w/Tangible Aspect PAGEREF _Toc511163499 \h 16Securities and Security Entitlements: Shares PAGEREF _Toc511163500 \h 16Transfer Restrictions PAGEREF _Toc511163501 \h 16How to Seize PAGEREF _Toc511163502 \h 17Effect of Seizure PAGEREF _Toc511163503 \h 17Alternative procedure: Judgment Act Charging Order: Public Company Shares PAGEREF _Toc511163504 \h 17Process PAGEREF _Toc511163505 \h 17Issuance PAGEREF _Toc511163506 \h 17Delivery PAGEREF _Toc511163507 \h 18Search: What bailiff can do to find assets PAGEREF _Toc511163508 \h 18Seizure PAGEREF _Toc511163509 \h 18What constitutes seizure PAGEREF _Toc511163510 \h 18Abandonment of seizure PAGEREF _Toc511163511 \h 18If JD sells seized assets PAGEREF _Toc511163512 \h 18Sale PAGEREF _Toc511163513 \h 18Payment PAGEREF _Toc511163514 \h 18Liability for Execution Costs PAGEREF _Toc511163515 \h 19Real Property PAGEREF _Toc511163516 \h 20Registration of Judgment PAGEREF _Toc511163517 \h 20Expiration of registration PAGEREF _Toc511163518 \h 20Effect of registration PAGEREF _Toc511163519 \h 20Sale by JD to BFPFV PAGEREF _Toc511163520 \h 20Joint Tenancy PAGEREF _Toc511163521 \h 20Sale of Land PAGEREF _Toc511163522 \h 20Hearings: PAGEREF _Toc511163523 \h 20Questions at each hearing: PAGEREF _Toc511163524 \h 21Possible arguments to make as a JD: PAGEREF _Toc511163525 \h 21Procedure: PAGEREF _Toc511163526 \h 21Payment: PAGEREF _Toc511163527 \h 22Equitable Remedies PAGEREF _Toc511163528 \h 23Mareva Injunction PAGEREF _Toc511163529 \h 23Worldwide Mareva PAGEREF _Toc511163530 \h 24Ancillary Order PAGEREF _Toc511163531 \h 24Equitable Receivers specific asset you can’t get at otherwise PAGEREF _Toc511163532 \h 24The Masri Revolution PAGEREF _Toc511163533 \h 25Future Debts PAGEREF _Toc511163534 \h 25Worldwide Receiver PAGEREF _Toc511163535 \h 25Equitable Charging Orders $ in court PAGEREF _Toc511163536 \h 25Reviewable Transactions PAGEREF _Toc511163537 \h 26Fraudulent Conveyances PAGEREF _Toc511163538 \h 26Fraudulent Preferences: tracing, show cause PAGEREF _Toc511163539 \h 27Exemptions, Immunities, and Priorities PAGEREF _Toc511163540 \h 28Debtors’ Exemptions PAGEREF _Toc511163541 \h 28Personal Property PAGEREF _Toc511163542 \h 28Registered Plans PAGEREF _Toc511163543 \h 28Wages PAGEREF _Toc511163544 \h 28Art PAGEREF _Toc511163545 \h 29Life Insurance PAGEREF _Toc511163546 \h 29Workers Compensation PAGEREF _Toc511163547 \h 29Crown Debts PAGEREF _Toc511163548 \h 29Canada Pension Plan PAGEREF _Toc511163549 \h 29Old Age Security PAGEREF _Toc511163550 \h 29Indian Act PAGEREF _Toc511163551 \h 29Creditor Priorities PAGEREF _Toc511163552 \h 30General Rule: Creditor Assistance Act PAGEREF _Toc511163553 \h 30Special Priorities PAGEREF _Toc511163554 \h 30Family Maintenance PAGEREF _Toc511163555 \h 30Woodworkers Liens PAGEREF _Toc511163556 \h 31Repairers Liens PAGEREF _Toc511163557 \h 31Wages PAGEREF _Toc511163558 \h 31Crown PAGEREF _Toc511163559 \h 31Federal Court Execution PAGEREF _Toc511163560 \h 31Consumer Ks & CollectionsRegulation of Consumer Transactions use to have K invalidatedDeceptive and unconscionable practices are prohibited in consumer transactions by the BPCPA. Consumer transaction: (a) a supply of goods/services/real property to a consumer for purposes that are primarily personal, family or household, or (b) a solicitation, offer, advertisement or promotion by a supplier WRT ss. (a) (s. 1)Deceptive act or practice: A representation or conduct by a supplier that has the capability, tendency or effect of deceiving or misleading a consumer: s. 4. Prohibited: s. 5. Once a deceptive practice is alleged, burden on supplier to disprove: s. 5.Unconscionable act or practice: Court considers all circumstances, incl. undue pressure to enter consumer transaction / supplier took advantage of inability or incapacity / total price grossly exceeded other similar transactions / no reasonable probability of full payment of total price by consumer / terms or conditions so harsh or adverse as to be inequitable: s.8. Prohibited: s. 9.Proof of an unconscionable act or practice renders the transaction unenforceable: s. 10.Regulation of Collections use to secure administrative penaltiesCommunicationAn unanswered call = a communication: CBV. With DebtorHarassment prohibited: Collector cannot communicate with debtor or debtor’s family/neighbour/friend/employer/acquaintance in a manner or with a frequency as to constitute harassment: BPCPA s. 114(1). Harassment includes: s. 114(2)Use of threatening, profane, intimidating or coercive language;Exerting undue, excessive, or unreasonable pressure; Publishing or threatening to publish a debtor’s failure to pay. if done w/intent to harass/annoy, also prohibited by CC s. 372(3).Notification required: Before attempting to collect debt, must notify/make reasonable attempt to notify debtor in writing of the name of creditor, amount of the debt, and authority of collector to collect debt: 115(1). Must not initiate verbal communication with debtor until 5 days after written notice has been sent, except for the purpose of requesting home/email address: 115(2)-(2.1) Not at work, unless:Collector does not have home address, email, or phone number & collector contacts debtor solely for purpose of obtaining that information: 116(1)(a)Collector has attempted to contact debtor at home/by email/phone but has not reached them: 116(1)(b). can make one attempt at work only: 116(2)Debtor authorized communication at place of employment: 116(1)(c)Only in writing if debtor so requests and provides a mailing address: 116(4)(a). Only through lawyer if debtor so requests and provides address for lawyer: 116(4)(b).No communication if debt disputed: If the debtor notifies collector and the creditor that the debt is in dispute and that the debtor would like the creditor to take the matter to court: 116(4)(c).With OthersNot w/debtor’s friends/family/neighbours/friends/acquaintances, unless the person is a guarantor of the debt, the debtor authorizes communication, or the collector doesn’t have debtor’s contact info and communication is to obtain it: 117(1)Not w/employer, except: to confirm employment, title, & address, or as auth’d by debtor: 117(2).Time of Communication Collector communications prohibited: 118(2)On a statutory holiday;On a Sunday, except between 1 p.m. and 5 p.m. local time for the person contacted; and On any other day, except between 7 a.m. and 9 p.m. local time for the person contactedCost of Communication Must not use means of communication that results in costs payable by person collector contacts: 119.CBVDebtor requested to be contacted only in writing. 126 calls made by automatic calling system after request. Two were answered, resulting either in a voicemail message or a conversation, but the rest were not. CBV argues that unanswered calls are not “communications”, since communication requires an exchange of information. Held: Calls were communications contrary to BPCPA.Legal proceedingsIf debt assigned to collector, must not bring legal proceedings unless debtor has been notified of the assignment and intention to bring proceedings: 121(1).Collector must not recommend that creditor bring proceedings for recovery unless debtor has been notified of intention to so recommend: 121(2).Collector must not threaten to bring legal proceedings for recovery of debt if collector does not have written authority of creditor or there is no lawful authority: 121(4).CollectionsCan’t collect from someone not liable/in excess of debt: A collector must notAttempt to collect money in excess of the amount of the debt owing: 120(a)Attempt to collect money from a person who is not liable for the debt: 120(b)Communicate w/a person who asserts (s)he is not the debtor, unless the collector first makes all reasonable efforts to ensure that person is in fact the debtor: 120(c)Restrictions on seizure: A collector must not: Remove from inside the debtor's private dwelling any personal property in the absence of the debtor, the debtor's spouse, the debtor's agent or an adult resident in the debtor's dwelling (unless court order to the contrary): 122(a).Seize/repossess personal property that is not specifically charged or mortgaged, or to which legal claim may not be made under a statute, court judgment or court order: 122(b). MisrepresentationsA collector must not supply any false or misleading information, misrepresent the purpose of a communication, misrepresent the identity of the collector/creditor, or use a document that suggests a connection to the court w/o lawful authority: 123. If done w/intent to injure or alar, Debt poolingIf a debtor pays money to a debt pooler for distribution to the debtor's creditors, that debt pooler must not act for/represent any of the creditors and is deemed to act for and represent the debtor: 127(1). Collection agent and bailiff fees and disbursementsCan’t charge debtor for fees/disbursements unless auth’d by enactmentRemediesDebtor may sue for damages due to contravention of act: s. 171.Criminal ProhibitionsExtortion: It is extortion to induce a person to do anything through use of threats, accusations, menaces or violence without reasonable justification or excuse and with intent to obtain anything. A threat to institute civil proceedings is not a threat for the purposes of this section: CC s. 346.Harassing communications: CC s. 372: Everyone commits an offence who: conveys information that they know is false with intent to injure or alarm a person,makes an indecent communication by a means of telecommunication with intent to alarm or annoy a person,repeatedly communicates with a person by a means of telecommunication without lawful excuse and with intent to harass them.The JudgmentDefault JudgmentsCan be set aside for two reasons:Discretionarily (based on fairness considerations). The court will consider a number of factors in deciding whether to exercise discretion, including whether: (Miracle Feeds)Failure to enter an appearance or file a defence to the plaintiff’s claim was wilful/deliberate;Debtor made application to set aside the DJ as soon as reasonably possible after learning of it, or has an explanation for any delay in the application being brought; andDebtor has a meritorious defence or at least a defence worthy of investigation.Procedural defects: Set aside ex debito justitiae, i.e. as of right, where DJ is granted in a manner that is contrary to rules of natural justice: Bache Halsey (application to strike w/o notice of intent to seek DJ).InterestPre-judgment: payable at rate court considers appropriate (Court Order Interest Act s. 1); accrues from the date the debt arose to the date of the judgment (COIA s. 6).Post-judgment: accrues at the prime lending rate from the date of judgment/date judgment becomes payable up to the point the debtor pays: COIA s. 7.Limitation PeriodsBC judgments expire 10 years after the date the judgment becomes enforceable: LA s. 7(a). Extra-provincial judgments expire after the earlier of:The expiry of the limitation date in the issuing jurisdiction: LA s. 7(b)(i).10 years after the judgment became enforceable in the issuing jurisdiction: LA s. 7(b)(ii).Effect of expiration: JC may not commence enforcement proceedings for payment of money or return of personal property: s. 7. JC may: Continue proceedings on unexpired writ of execution, but may not renew writ: LA s. 23(1)(a).Commence or continue proceedings against land if judgement registered on title, but cannot renew registration unless proceedings are commenced: LA s. 23(1)(b).Continue proceedings WRT charging order: LA s. 23(1)(c).Stays of execution suspend the running of limitation periods: LA s. 23(2).Extend lifespan of judgmentBring an action on the judgment. Adds 10 years to timeline (Young)Abuse of process: action can be struck if debtor establishes that it is an abuse of process because, e.g., JC has not made any attempt to collect. JC is not required to bring evidence of efforts to collect. (Young: suit on action 2 days before expiry; no evidence of abuse of process (but also no evidence of attempt to execute)).Issue a writ of seizure and sale prior to expiry. Note that you are limited to execution on the property identified in the writ. Adds 1 year to the timeline: LA s. 23(1)(a).Register judgment on title prior to expiry. Adds two years to the timeline: LA s. 23(1)(b).Apply for a charging order. Adds as much time as is necessary to complete: LA s. 23(1)(c). Seek a stay of execution. Causes clock to stop on limitation period; restarts when stay is lifted: LA s. 23(2).Recognition of Foreign JudgmentsCanadian Jurisdiction: As a matter of constitutional law, Canadian courts must give full faith and credit to judgments from other provinces: Morguard (mortgage in AB). Final pecuniary judgments and all non-pecuniary judgments may be registered w/court and enforced as judgments BCSC: Enforcement of Canadian Judgments and Decrees Act, ss. 2, 4. Court may alter or stay order, but only in limited circumstances: ECJDA s. 6. Reciprocating Jurisdiction: UK, Australia, Germany, Austria, 6 US states (Washington, Alaska, Oregon, California, Colorado & Idaho), and Canadian provinces other than QCMay be registered in BCSC if: Enforcement period has not expired in the reciprocating state OR 10 years since judgment became enforceable: COEA s. 29(1).Must be final: COEA s. 29(6)(e). JD can resist registration by demonstrating that court acted without jurisdiction, judgment obtained by fraud, a good defence to an action on the judgment exists, or b/c public policy reasons: COEA s. 29(6). Anywhere Else: must bring a civil action on common law principles and establish: (Morguard: mortgage in AB)The foreign judgment is final and conclusive, andThe foreign court had jurisdiction:The D was present and served in the jurisdiction, ORThe D attorned to the jurisdiction of the court (i.e. participated in the action), ORA real and substantial connection exists between the cause of action and the jurisdiction low threshold. Stays of ExecutionJudgments are payable immediately unless the court orders otherwise: COEA s. 48. Effect: delays execution. Pending AppealCourt has the discretion to grant a stay if an appeal is brought: Court of Appeal Act s. 18; Supreme Court Act s. 65.1. BC Appeal: factors in determining whether to order a stay (Davidson):Is there a serious question to be tried? Applicant must establish that there is an arguable case, that the case is not frivolous or completely without merit. This is a low threshold.Would the applicant suffer irreparable harm if the application were refused? A bare assertion of financial harm w/o evidence will not suffice (Davidson: applicant alleged bankruptcy w/o putting forward any financial evidence) Which of the parties would suffer greater harm from the granting or refusal of the remedy pending a decision on the merits? I.e., where does balance of convenience lie? Consider:Necessity of preserving the subject matter of the litigation Prevention of irreparable harmExisting special circumstances C doesn’t need to show that they need $: entitled to fruits of J. Foreign Appeal: A stay of proceedings should normally follow when an appeal of a foreign judgment is pending: Litecubes (appeal in Missouri).Policy reasons supporting this conclusion: Saves the Court and parties the time and expense of litigating the enforcement of a judgment that may ultimately be reversed. A BC judgment recognizing the foreign judgment is not automatically vacated if the foreign judgment is reversed or varied. Consequently, a JD must institute fresh proceedings to set aside the judgment if the foreign judgment is ultimately reversed.Conditions: If there is a significant risk that a D may dispose of assets, the court may require the D to post security or enjoin it from disposing of assets. D must prosecute its appeal promptly; may limit the duration of the stay to ensure this happens.Discretionary StayThe Court has a general discretion to suspend the execution of a judgment for the time it considers proper pursuant to COEA s. 48(2) and Civil Rule 13-2(31). No one test governs stays: Lau (99 year lease; awaiting determination of misrepresentation action; grave prejudice). Factors to consider include: Whether “special circumstances” exist favouring a stay; The balance of convenience; Whether a stay would prevent unnecessary proceedings; Whether a stay is necessary to do justice between the parties; The relative prejudice to each party; Protection of litigants; and Whether an appeal or counterclaim is outstanding. Alternative: Voth OrderRequires the JD to pay the full amount of the judgment into court, which is then partially or wholly paid out to JC. JC must provide:Security for the amount withdrawn + estimated amount of JD’s costs; andUndertaking to pay interest on the judgment with the rmation AcquisitionUseful in two ways: getting info about assets that can be used in execution and punishing recalcitrant debtor. Examination in Aid of Execution Wider scope than subpoena, but weaker enforcement mechanisms. Availability: Any kind of judgment.What: Permits inquiry into a broad range of matters, including (R. 13-4(2)): Any matter pertinent to the enforcement of the order,The reason for non-payment or non-performance of the order,JD’s income and property The debts owed to and by the JDProperty disposal The means the JD has, had, or may have of satisfying the order, andWhether the JD intends to obey the order or has any reason for not doing so.Incl. documents: must produce all non-privileged documents: R. 7-2(16). Who: Debtor, but court may order examination of someone other than JD if satisfied that they have knowledge of matters in (2) (e.g. spouse): R. 13-4(5). Contempt: If person refuses to attend examination/to answer questions or is otherwise difficult, court may make orders (e.g.) requiring attendance at appointment, directing party to answer specific questions, etc.: R. 13-4(6). If behaviour continues after order, may initiate contempt proceedings pursuant to R. 22-7/8. used in Doobay.See Code for provisions re: informing self (22), use of transcripts in subsequent proceedings (8), examination of corporate/firm debtor (3), max 1 exam per year (4), service + fees 7 days before examination (13), costs to JC (9)Subpoena to Debtor More limited scope than XAE, but has teeth (in-built contempt + order). Availability: money judgment only: R. 13-3(1).What: Examination on oath before an examiner (judge, master, registrar – (5)) as to JD’s income, property, debts (owing and owed), disposals of property, and means JD has, has had, or in future may have to satisfy order: R. 13-3(4). Result: Examiner may order (inter alia) payment by installments, payment by fixed date, costs: R. 13-3(11).Contempt: Committal available if JD: Does not attend: R. 13-3(8).Refuses to be sworn, answer questions to satisfaction of examiner (i.e., in a full and frank way) or to produce documents/property: R. 13-3(8). Has, w/intent to defraud creditor, conveyed, removed, or concealed property: R. 13-3(10).Has unreasonably neglected to pay the debt in whole or in part or to pay any instalment ordered to be paid: R. 13-3(10) applied in Blaxland (JD lives lavish lifestyle through generosity of family but fails to pay). Disobeys order to pay made under (11) where JD knew of order and does not show good cause of why order should not be made: R. 13-3(13).JD must be brought before court immediately after execution of committal order. If Court believes committal inappropriate, may stay execution of committal order and set hearing to set aside (w/notice to JC): R. 13-3(19). Enforcing committal order:Expires one year after issuance: R. 13-3(16). JC must deliver committal order to sheriffs in order to have it enforced. JC must pay sheriff $10/day for maintenance of JD: R. 13-3(17). If not paid, sheriff must release JD: R. 13-3(26). The maintenance money is recoverable from JD as a cost of execution: R. 13-3(18). Unnecessary and vexatious subpoena may result in compensation order: R. 13-3(9). Use of subpoena testimony in different proceedings alone does not demonstrate that subpoena was vexatious: Signalchem. ContemptFailure to pay money owing on judgment is contempt, but the party in contempt is not liable for punishment simply for failure to pay: Stevenson. Elements of contempt (must be proven BARD): Carey (lawyer breaches Mareva; argues heightened mental element should apply found in contempt): Clarity: order must be clear as to behaviour it prohibits/requires; Knowledge: alleged contemnor must have actual knowledge of the order (or be wilfully blind to it); Intention: alleged contemnor must have intended to do/not do the action the order forbids/requires.Restraint: Contempt power should be used with great restraint. The court has the discretion to decline to find contempt if the contemnor acted in good faith and took reasonable steps in attempting to follow the order. Similarly, a judge may decline to find contempt where it would work an injustice in the circumstances of the case: Carey (lawyer breach).Remedies: Court has wide discretion to fashion appropriate contempt remedies and is not constrained by those remedies listed in the Rules: Bea (parking lot dispute; condo ordered sold).An appropriate contempt remedy will (1) have as its primary purpose coercion of contemnor to obey court orders; and (2) be necessary, in the sense that no less drastic remedy is available: Bea (condo). May impose successive punishments for ongoing breach: Doobay (continued contempt in XAE after 21 day committal + fine).GarnishmentGarnishing order requires that a third party (the garnishee) pay a debt it owes to the debtor into court. Advantages: not subject to CAA (Tan).Disadvantages: can be impractical (because no continuing GO).ProcessStep 1: ex parte application for garnishment order: COEA s. 3(2). Step 2: GO served on garnishee pursuant to COEA s. 9(1). Step 3: garnishee pays money into court “at once”. Alternately, garnishee may dispute order by filing a dispute note: COEA s. 11(1).Step 4: payment out of court of money to judgment creditor: COEA s. 12. CriteriaBasic Definition: The COEA makes “debts, obligations and liabilities owing, payable or accruing due and wages that would in the ordinary course of employment become owing, payable or due within 7 days” attachable: COEA s. 3(1). Type of DebtGarnishable debts include debts arising out of K or trust & any judgment debt: COEA s. 3(1). Joint Accounts: not attachable unless both account holders are debtors OR for maintenance debt (FMEA s. 15(3.2, 3.3)): Field (successful suit against bank for paying joint account funds into court). RRSPs and RRIFs: exempt from execution: COEA s. 71.3. Wages: garnishable, but 70% of each paycheque is exempt from attachment (if less than $100, see rule): COEA s. 3(5). Note that GO may be issued up to 7 days before wages become due: COEA s. 3(1). Rent: rent that is not yet due is not attachable: Access Mortgage (GO issued 7 days before end of month invalid). Timing: “due or accruing due”A debt must actually exist at the time a GO is issued (Dabrowski: GO issued 30 minutes before livestock auction at which debt arose) - AND - At the time order is served (COEA s. 9(1): debt bound from time of service). Conditional Debts Conditional debts are not attachable: Vater (disability benefits contingent on JD being alive & disabled not garnishable)Exception: conditions of mere administrative convenience do not preclude garnishment: Bel-Fran (term deposit withdrawal conditions [7 days’ notice, surrender of term deposit receipt] = admin convenience garnishable).Permissible conditions: if condition is merely fluxion of time (e.g. promissory note or a postdated cheque) or bank account demand.Location of DebtGeneral Rule: Garnishee must be located within the court’s jx: COEA s. 3(2)(e). A garnishee is located within jx if there is a branch in province: Mitchell (garnishee’s head office in TO, branch in Vic in jx) .Does not matter where debt incurred/is payable: Mitchell (incurred in St. Lucia, payable in TO).Bank accounts: must serve GO on the branch of account: Bank Act, s. 462. Ex juris service: GOs may be served ex-juris, because the property is held by the bank as a whole and not the particular branch: Univar (GO issued in BC served in ON). Edinger thinks this is incorrect and authorizes a remedy of doubtful constitutionality. In her view, property is located in the jx of branch; therefore, the Univar approach authorizes extrajurisdictional seizure. Her solution would be to convert GO into judgment in the jx the branch is in and serve it there. Pre-Judgment GarnishmentAvailabilityUnavailable at common law: Lister. Authorized by COEA s. 3(2)(d). Affidavit in support must state: COEA s. 3(2)(d)(i) that an action is pending,(ii) the time of its commencement,(iii) the nature of the cause of actionMust be sufficiently described: Gray (see below - meticulous compliance).(iv) the actual amount of the debt, claim or demand, and(v) that it is justly due and owing, after making all just discountsIf D claims a liquidated sum by counterclaim, the court may consider this a just discount which should be deducted. Damages will not be deducted.Liquidated sum: Politeknik. If not liquidated, seek Mareva.Liquidated means a “specific sum” which is either “already ascertained or capable of being ascertained as a mere matter of arithmetic”. If the claim requires “investigation, beyond mere calculation,” then it is damages: Gray (claim not liquidated b/c court must determine what expenses were “reasonably incurred”).Cannot garnish wages pre-J: COEA s. 3(4).Setting Aside Pre-JGOIf set aside for any reason other than discretion, order is void and must be set aside in its entirety: Politeknik. Should not have been given in the first placeI.e., fails to meet basic requirements set out above.Imperfect ComplianceMeticulous compliance: Pre-J GOs are extraordinary remedies. As a result, there must be meticulous compliance with the statute: Gray. Standard of compliance is not perfection. Defects in the materials for a garnishing order will not be fatal as long as there is no confusion or uncertainty as to the basis upon which the order was issued: Politeknik. If a defect is technical or procedural only, the party affected by the order must show some prejudice in order to have the order set aside: Gray. Set aside: Pybus: P failed to serve NOCC, 3 GOs on D in 6 months, in spite of requests by D and requirements of COEA s. 9(2). Not set aside: Gray: P described the debt as owing “pursuant to the Agreement described in the NOCC” but failed to attach the NOCC. However, D & Registrar had NOCC no confusion.No Full & Frank DisclosureBecause of the ex parte nature of the application, the P is required to make full and frank disclosure of all material facts related to the cause of action asserted against the D. A material fact is one that may have affected the outcome of the application. (Politeknik)Set aside:Politeknik: P failed to disclose that the garnished subsidiary was not a party to the written K between P and parent co.Evans: P failed to disclose that funds held by garnishee were frozen by Securities Commission and litigation to determine priority over funds was ongoing. Discretion The Court has the discretion to release all or part of the garnishment where D establishes that doing so would be “just in all the circumstances”: COEA s. 5; Redekopp.Factors (non-exhaustive): Redekopp: Strength of the P’s caseUndue hardship to the DNecessity (whether attachment is necessary to ensure that the plaintiff can recover if successful)Not determinative: Gray (D in strong financial position. Other factors neutral. Court declines to set aside on this ground).Any other factor affecting justice of orderAbility to do business: not be reasonable to deprive D of all operating capital pending resolution of litigation. Should be able to pursue business opportunities, albeit in a diminished capacity: Redekopp (1/2 of order set aside, even though P’s case is strong; no undue hardship; & necessary, because no evidence of exigible assets in BC).Priority Over Garnished Funds Priority is relevant only WRT pre-judgment garnishment. The COEA provides that a debt is bound from the time that the GO is served on the garnishee: COEA s. 9(1). Meaning of “bound” depends on type of GO (BC Millwork: creditor gets pre-J GO; another JC ):Pre-JGO: service merely freezes debt; charge forms when judgment is obtained. Consequently, any JC can seek an equitable charging order for the funds. If multiple creditors seek access to pre-J GO funds, priorities apply (but note that equity believes in sharing, so other than statutory priorities, court likely to order sharing). Post-JGO: service creates an equitable charge on the funds. Consequently, garnishor has priority over funds. Enforcement: Order AbsoluteIf garnishee fails to either pay $ into court or file a dispute note, court may (discretionarily) issue a garnishing order absolute, which makes the garnishee personally liable for entirety of JD’s debt: COEA s. 11(2). Writ of Seizure and SaleWhat can be seized?Goods, Chattels, and Effects: TangiblesSubject to exemptions, all goods, chattels, and effects of JD are liable to seizure and sale: COEA s. 55. Includes legal and equitable interests: COEA s. 62. Only includes tangible property: Bank of BC (which rejected inclusion of intangibles in Vancouver A&W). Therefore, cannot seize financial assets (Bank of BC: RRSPs) or patents/trademarks (Mortil: software). Tangible property containing patented material may be subject to seizure. Conditions to protect trade secrets should be imposed on sale: Mortil. Does not include land (e.g. leases): COEA s. 56.Does include resource interests: mineral title, coal, petroleum, natural gas, and geothermal resource permits, licenses, and leases + machinery & property on locations of permits: COEA s. 57. Crown immunity: Property owned/leased by Crown is immune from seizure: Cybulski (Crown van).Money and Security for Money: Intangibles w/Tangible AspectA sheriff must seize money, bank notes, cheques, bills of exchange, promissory notes, bonds, specialties or other securities for money belonging to JD: COEA s. 58. What is a “security for money”? Something tangible that is the equivalent of cash. Bearer bonds/street certificates: equivalent of cash, so exigible security for money. Shares may be in foreign co. Patmore. Insurance Policy: a fully paid life insurance policy is an exigible “security for money”: Nisbet. NB: If a spouse, child, grandchild, or parent is designated as a beneficiary in a life insurance policy, it is exempt from seizure: Insurance Act, s. 65(2).RRSPs are securities for money (though now exempt by COEA s. 71.3): Bank of BC. EE’s speculation:Bitcoin? Probably not, because there is no tangible aspect. Licenses (e.g. taxi/fishing licenses)? Maybe – they have cash value. Intellectual property? Probably not, though more likely than bitcoin.Procedure: Money and bank notes must be delivered to JC; sheriff must hold other instruments until such time as they become payable (at which time he may sue on them in his own name): COEA s. 58. Securities and Security Entitlements: SharesJD’s interest in securities may be seized in accordance w/Securities Transfer Act: COEA s. 63.1. Transfer Restrictions: Securities with transfer restrictions may be seized only if issuer is BC company: COEA s. 65.1(2).Sheriff is bound by transfer restrictions when selling securities: COEA s. 65.1(3). Exception: if court considers that the restrictions were imposed w/goal of defeating/otherwise hindering execution, court has discretion to make any of a number of orders up to and including dissolution of the company: COEA s. 65.1(5).Purchaser is deemed to be a party to unanimous shareholder agreements (“USA”) regarding management of the business or the exercise of voting rights: COEA s. 65.1(8). Purchaser is not liable to make financial contribution to the corporation or provide indemnification of the corporation’s debts (even if provided in USA): COEA 65.1(9).How to Seize: NB: unconstitutional to seize certificate from company’s HQ if outside the provinceCertificated security:If certificate has been surrendered to issuer: by serving notice of seizure on issuer’s chief executive office: STA s. 48(2).Otherwise: by actual (physical) seizure of paper certificate: STA s. 48(1).**Uncertificated security: by serving notice on issuer’s chief executive office: STA s. 49.**Security entitlement (security held by broker): by serving notice on broker: STA s. 50.**Seizure becomes effective when the issuer or broker has had a “reasonable opportunity to act on the seizure, having regard to the time and manner of receipt of notice”: COEA s. 63.1(2). [EE: unclear when seizure has become effective in these circumstances, which may cause problems if securities are transferred sometime after receipt of notice.]Effect of Seizure: Entitles sheriff to do anything that would otherwise have to be done by JD and prohibits JD from dealing with or disposing of securities: COEA s. 64.1. Alternative procedure: Judgment Act Charging Order: Public Company Shares JA (1838) s. 14 provides that a charging order is available where JD owns/has equitable interest in: Government stocks, funds, or annuities, or Stocks or shares of or in any public company in England It is unclear whether JA is still in force in BC. The section of the COEA that made the JA expressly available was repealed in 2007. But because the Act was in force in England prior to 1851, it is arguable that the statute has independent force until such time as it is repealed or replaced (which it has not yet been) pursuant to the Law and Equity Act, s. 2. Applicability: Consumer ImaginetS. 14 should be read as pertaining to stocks or shares in a public co. in the province. A company is in the province if its headquarters are located here. Company needn’t be incorporated in the province. The fact that a JD’s share certificates are not in the province is irrelevant if the share registry is located here. ProcessIssuance Administrative writ issued by registrar in Form 50. Writ includes amount of judgment, plus interest, plus costs that you want the sheriff to levy (seize)Once issued, the WSS is good for one year (R. 13-2(18)). Can be renewed for one year (R. 13-2(19)).Delivery JC must deliver writ to court bailiff for execution. Bailiff executes writs in the order in which they are delivered.Search: What bailiff can do to find assetsBailiffs cannot: use force to gain entry to JD’s dwelling houseBailiffs can: Enter a dwelling house if door is unlocked or if invited to do so. Use force to gain entry to interior rooms, cupboards, etc. Use force to gain entry into any building that is not a dwelling house.Indemnification: if bailiff uses force to enter a third party’s property, must indemnify against losses. Re Boyce (drilling case).SeizureSeizure binds the goods: Law and Equity Act, s. 35(1). What constitutes seizure:Seizure is effected upon entry of the premises and intimation of intention to seize (which is not satisfied by demanding repayment of the debt).E.g. Lloyds (seizure of caravan - intention to seize demonstrated by reading out warrant & seeking signature on walking possession agreement). Abandonment of seizure: A claim has been abandoned where the bailiff demonstrates an intention to do so. Intention is to be inferred from the evidence as a whole. Merely leaving the premises does not constitute abandonment, nor is leaving without an executed walking possession order.E.g. Lloyds (visiting caravan ever week not consistent w/intention to abandon claim). If JD sells seized assets: If an asset has been seized and has not been abandoned, the bailiff gains a “special property” to the asset (i.e., the title is encumbered by the seizure). While a JD may sell the asset, the bailiff is entitled to repossess it from a third-party purchaser regardless of whether they had notice of the seizure.SaleBailiff sells the property (does not just transfer property to the JC). Bailiff generally sells at public auction to avoid complaints that sale price was unfair. However, the bailiff may opt to sell as private tender.PaymentBailiff pays out the proceeds of the sale to the JC. Priority: established by Creditor Assistance Act, s. 3 (proceeds distributed pro rata to all creditors who have delivered writs/certificates to bailiff prior to or within 30 days following seizure). Modifies common law (first in time, first in right). Liability for Execution CostsIn general, JD is liable for execution costs. However, JD not liable where such costs are incurred unnecessarily: Cybulski (execution against Crown-leased van after being advised that payment is in progress). Real PropertyRegistration of JudgmentCan be registered immediately: COEA s. 86 (note that s. does not say “immediately,” but is interpreted in keeping with s. 82 (reg. of pre 1979 Js), which does). There is no requirement in BC to exhaust remedies against tangible personal property prior to execution against land. If a JD wishes to satisfy debt through sale of goods rather than land, can sell them personally and use proceeds to pay debts: Re Schiava. Procedure: identify what property JD owns; deliver signed & sealed copy of judgment to LTO: COEA s. 88.Expiration of registration2 years after registration: COEA s. 83(1). Exception: family judgments are non-expiring: FMEA s. 26(5).Renewal: A JC may renew registration prior to expiration: COEA s. 91(2). When registration of a judgment expires, it is not revived by subsequent reregistration. Consequently, the JC loses priority over other debtors registered on title: Butler Lafarge.Registration of a CPL does preserve priority in absence of a registered judgment: Butler Lafarge.Effect of registrationFrom the moment of registration, judgment forms a lien and charge on the land in the same manner as a charge made by the JD: COEA s. 86(3). Does not convert JC into a secured creditor.Sale by JD to BFPFVSubject to rights of BPFV prior to registration of judgment: COEA s. 86(3).If a JD sells land and the buyer is aware that a J is registered against title, the title passes subject to the judgment: Jacques. It is not clear whether the buyer must have actual knowledge or whether constructive knowledge is sufficient.If K for sale is concluded prior to registration, purchaser takes clear title: Fulthorp; COEA s. 86(3)(c). Joint TenancyCan register on title, but registration does not sever title; must apply to have tenancy severed in order to execute: Muntain.If the JD dies, the title ceases to be encumbered by the judgment: Muntain.Sale of LandHearings:Show cause hearing: JC makes application calling on JD to show cause why land should not be sold to realize amount payable: COEA s. 92(1). Inquiry: if JD fails to show cause, the court must order an inquiry: COEA s. 94. Registrar must inquire into the following and report findings to the court (COEA s. 94(1)):What land is liable to be soldJD’s interest in landWhether there are judgments reg’d against land and what their priority isHow proceeds should be distributed (consider Creditor Assistance Act)Confirmation: If land is found liable to be sold, an order must be made by the court directing sale of land: COEA s. 96(1). Discretion:Statutory: if property is a family home, can defer sale: COEA s. 96(2).Common law: discretion as to:Conduct of sale. This ensures that sale process is fair (no collusion, for a fair price) (Wardle). Examples:Requiring court approval of sale: Wardle. Ordering sale by real estate agent instead of sheriff: Topouzis. Deferral of sale (Topouzis). Examples: Court ordered deferral in order to allow owner opportunity to develop property, which would increase equity substantially: Topouzis. Court deferred sale of JD’s ranch, because doing so would completely destroy JD’s enterprise. This prejudice would far outweigh the prejudice suffered by the JC in waiting for payment (and accruing interest in the meantime): Pegg.Degree of prejudice is a relevant in determining whether to exercise discretion: Pegg. Questions at each hearing:In CSA Building Sciences, Master Wilson held that different issues should be considered at each of the three hearings provided for by the COEA:Show cause hearing: is the property liable to be sold?Inquiry: what is the debtor’s interest in the property?Confirmation: when and how should the property be sold?However, a plain reading of the legislation suggests that a full hearing may be held at each step.Possible arguments to make as a JD: There is no debt, because it’s been satisfied or judgment has expiredPlanning to sell other property (NB that per Re Schieva, the JD does not have to look to personal property for satisfaction of J first. However, can still say that you are attempting to sell something else that will satisfy the debt).Family home: at inquiry, court has discretion to defer sale subject to conditions of payment: COEA s. 96(2). Property does not belong to JD, either because of sale (Fulthorpe) or because someone else holds an equitable interest in the propertyJD has no/little equity in property, so there’s no point in selling it: won’t help JCSuggest payment plan Procedure:Timing of sale: no sooner than one month after order for sale delivered to sheriff: COEA s. 100. Notice of sale: sheriff must give notice of sale in the Gazette and advertise in a local newspaper for 7 days preceding sale. Specific requirements of ad contents. COEA s. 101.Plaintiff or mortgagee can purchase: acquires same interest as any other purchaser: COEA s. 103. No good offers: sheriff can adjourn sale if no/no good offers are made: COEA s. 104. Proceeds: proceeds paid into court less fees/expenses (COEA s. 106)Sale valid in spite of irregularities, as long as purchaser is not a party to them: COEA s. 107.Proceeding not affected by marriage/death/bankruptcy: sale of land is not affected for those reasons/purchaser gets absolute title to estate and interest of execution debtor: COEA s. 108.Payment:Proceeds on sale subject to CAA: COEA s. 110, 111.Foreclosure: CAA does not apply to foreclosure proceedings. Payments made based on order of registration: Roadberg. Consequently, a JC who has a high ranking should wait for mortgagee to foreclose. Equitable RemediesMareva InjunctionBasics:Statutory authority: Law and Equity Act, s. 39.Availability: pre- or post-judgment. Can be used in conjunction w/arbitration: Tracy.Effect: Restrains debtor from disposing of or dealing with assets. Procedure:Ex parte application (∴ full and frank disclosure: Mooney No. 1). Undertaking as to damages (Mooney No. 1). Exception: class action (Tracy). Jurisdiction: Requires personal jx over D (because in personam remedy): Silver Standard. Per Morguard, jx may be established by:D’s presence in jx;D’s submission to court’s jx; Real and substantial connection to BCTest: Silver StandardThreshold: “good arguable case”: case must be more than arguable, but does not have to meet the “bound to succeed” threshold (Tracy). Risk of a dry judgment: evidence that establishes the existence of assets within the scope of the MI and a real risk of their disposal or dissipation so as to render nugatory any judgment. Must be substantiated, not based simply on suspicion: Mooney No. 1No requirement of fraudulent intent: Silver Standard. E.g. Mooney: JD habitually arranged affairs to make himself “bullet proof” & had outstanding judgments against him.Just & convenient: Court must balance the interests of each party to determine whether an MI would be just and convenient in all the circumstances. Factors include, but are not limited to: Irreparable harm to D If MI will put D out of business, it is likely unfair: Aetna.E.g. Davila (MI requiring that mine stop operating not granted):Prejudice to employees, who will be laid off;Mexican gov’t may cancel concessions if mine can’t pay duties;Mine needs revenues to pay existing creditors; Mine would deteriorate w/o proper care;The corp would become insolvent without revenues.Potential effects on third parties Other creditors: balance of convenience usually weighs against an order that will prevent the D from paying a debt incurred in the ordinary course of business: restricts payment of debts incurred in the ordinary course of business: Silver Standard. Other factors: Mooney 2.The nature of the transaction (local, national, international) giving rise to the cause of actionThe risks inherent in that transactionThe residency of the respondentEnforcement rights for judgment creditors in the jurisdiction where the respondent's assets are locatedThe amount of the claimThe history of the respondent's conduct Scope of MI: must also establish the proper scope of the order. Length: the duration of an order should be limited; court may require an undertaking to expedite trial: Tracy. Amount: must determine value of the claim and include assets sufficient to discharge it: Tracy.Worldwide Mareva: Must demonstrate that there are assets located outside of BC which, if dissipated or concealed, would frustrate any judgment obtained against the defendant: Mooney 1.The fewer assets that the defendant has in BC, the more likely the Court will be to grant the MI: Mooney 1.“Exceptional circumstances” must be present to justify a worldwide Mareva injunction – Mooney 2This may be satisfied by the defendant having a foreign residence and having a history of complicated international business dealingsAncillary Order to disclose location and value of assets required to “breathe life” into MI: Davila.Equitable Receivers specific asset you can’t get at otherwiseAuthority: s. 39, Law and Equity ActWhat: Permits execution against an asset that, but for a legal or practical impediment, would be subject to legal execution. The ER must be appointed WRT a particular asset/assets: Interclaim.Test: InterclaimThe asset must be of a kind that is exigible by legal process. The courts have been inconsistent in their application of this requirement. The question at this stage has been variously phrased as:Is this class of asset exigible? broadest (favourable to JC). Exigible: shares as a class are exigible (even though these particular shares found to be non-exigible b/c extraprovincial corp) (A&W). Not Exigible: statute prohibits any execution on pension benefits (Klyne).Is this particular asset exigible? middle groundIs this particular asset exigible right now? narrowest (favourable to JD)Not Exigible: payment to occur imminently, but not yet due: Fox (but see Masri, below).There must be either: A legal or practical impediment to legal execution:Successful: law prohibits execution of these specific shares, in spite of the fact that shares are exigible as a class (A&W).Unsuccessful: fact that assets are located in foreign jx may be an impediment, but not if it is a common law jx (here, UK)/some other jx with legal processes that permit execution (Interclaim).Edinger’s Musings: could use for:Statutory immunities (e.g. RRSPs)Joint accounts- OR -Special circumstances: Fraud: NEC (court appointed receiver of all assets in province because of D’s dishonesty)Attempt to spirit money out of the jx: NEC. More convenient way to collect: Goldschmidt, quoted in NEC (numerous debts were about to become due to JD; court held that ER could be appointed to avoid necessity of issuing individual GOs/risk that debts would have been paid out before GOs served).Appointment must be just and convenient in all the circumstances. The Masri RevolutionIn Masri, the English CA decided to abandon the 19th century rules that continue to govern ER. It suggested that instead, courts should be guided by the demands of justice. If arguing for JD: in Masri itself, the court notes that equitable remedies must be developed incrementally. Following Masri would be a revolution, not an incremental change. Future DebtsIn Fox, the court declined to appoint an ER for a debt that would be paid imminently, but was not yet due. The claim failed at the first stage, in that garnishment was not available for a debt not yet due. In Masri, the English Court of Appeal held that future debts may be garnished. Worldwide ReceiverIn Interclaim, the court held that ER was not available for assets held outside the jurisdiction. In Masri, the court held that it could appoint a worldwide ER. Equity operates in personam; thus, jurisdiction to appoint an ER exists as long as the court has personal jx over the JD. Because receivers are a post-judgment remedy, jx in fact exists in every case. Equitable Charging Orders $ in courtLimited to property in custodia legis (generally money in court)JD must be presently entitled to the property: Chima. If there are other creditors (including creditors who are not JCs) who may have a claim to the funds, court can grant an order nisi, which becomes absolute after 6 months. In the intervening period, the JD or other creditors may show cause to vary or discharge the order nisi: Rennison. Available post-judgment (in most cases; one pre-judgment case).JC must have clean hands (even if funds ended up in court through illegal process): Millar (cops seize $ illegally; does not deprive CRA of equitable charging order).Reviewable TransactionsFraudulent ConveyancesRule: The act prohibits dispositions of property made to delay, hinder or defraud creditors and others of their just and lawful remedies. Such transactions are void and of no effect: FCA s. 1. Exception: does not apply to a disposition of property for good consideration to a person who, at the time of the transfer, has no notice or knowledge of collusion or fraud: FCA s. 2. Burden: on the creditor attacking disposition on BOP. Exception: if the disposition is to a near relative, the burden seems to shift to the debtor to establish that there wasn’t the necessary intent. Standing: “Creditors and others” includes:Creditors whose claim arose after the disposition: Boukalis. Creditors whose claims arise from a speculative venture embarked upon by the debtor immediately before or after having executed the transfer under challenge: Mawdsley.Creditors who were secured at the time of the disposition but become unsecured WRT part of the debt (because asset securing interest turns out to be worth less than debt): Boukalis.Elements: Actus reus: disposition of property (incl. mortgages) that is currently exigible in the province. Mens rea: intent of transferor to delay, hinder or defraud at time of transfer. Must only establish intent to put the assets out of reach of creditors. Does not require proof of moral turpitude or mala fides on the part of the transferor: Abakhan. Exception: Good consideration: May be something less than market value. Can be reduced (but not eliminated) by “natural love and affection” if transfer is to near relative: Chan (xferred assets to closely held corp w/complicated share scheme to avoid losing house).No notice/knowledge of collusion/fraud on part of transferee Proof of Mens ReaDirect admission: e.g. Abakhan (acknowledged intent to limit liability in new partnership).Effect of disposition: intention may be inferred from the effect of a transaction, but there is no rule of law that in every case, an intention to defeat creditors must be inferred from the effect of the impugned transaction: Mawdsley (wills variation). Badges of fraud: circumstantial evidence which leads to an inference that transferor must have had the necessary intent. Common badges (Banton):State of financial affairs at the time of xfer, including income, assets, and debts Relationship between transferor and transferee Effect of disposition on the assets of the debtor Evidence of haste in making the disposition Timing of transfer relative to the debt Whether transferee gave consideration for the transfer Tracing & Show Cause ApplicationTracing: if the transferee has disposed of the property, can seize the proceeds from them: FPA s. 7.Show cause: a creditor can make an application calling on the debtor and transferee to show cause why the disposition shouldn’t be set aside: FPA s. 9.Exemptions, Immunities, and PrioritiesDebtors’ Exemptions Exemptions under COEA apply to bankruptcy proceedings: Atwal; BIA s. 67(1)(b).Personal Property Exempt from forced seizure or sale by any process at law or in equity at option of debtor: COEA s. 71Necessary clothing for JD and dependents; Furnishings and appliances ($4,000: Reg. 2(a))One vehicle ($5,000 (unless family debtor, in which case, $2,000): Reg. 2(b))Tools and personal property of JD that are used for occupation ($10,000: Reg. 2(d)) Medical and dental aids that are required by JD and dependents (no pecuniary cap)Personal property prescribed by regulations (this has never been added, so not exempt). must claim exemption within 2 days of seizure: Lee; COEA s. 73(2). Real PropertyJD’s principal residence (equity not exceeding $12,000 in Vancouver; $9,000 elsewhere) exempt from forced seizure or sale by any process at law or in equity at the option of debtor: COEA s. 71.1(1); Reg. 3.“Forced” may include sales made by JD in the face of an impending forced sale: Nguyen.Exception: does not apply to proceedings in respect of a mortgage: COEA s. 71.1(2). This section precludes a debtor from claiming their exemption as against a mortgagee WRT monies owed pursuant to the mortgage: Nguyen. Court has discretion to defer sale of family home: COEA s. 96(2).Registered Plans Exempt from any enforcement process: COEA s. 71.3(2).Includes RRSP, RRIF, and DPSP: COEA s. 71.3(1).Exceptions: COEA s. 71.3(3). Property contributed to plan after or within 12 months before the debt became came due;Property that has been or is being paid out of a registered planThis s. does not apply to property xferred to (1) another registered plan held by planholder or (2) spouse after planholder’s death pursuant to terms of plan: COEA s. 71.3(4)(a).Execution against an RRSP to satisfy a family order “payment out”: Okanagan. Property paid out of registered plan is deemed to be a debt due to planholder for salary or wages (so see wage exemptions): COEA s. 71.3(4)(b).Enforcement of family maintenance orders; andEnforcement processes initiated against a registered plan before November 1, 2008.Wages70% of any wages due exempt from seizure or attachment: COEA s. 3(5). Amount of the exemption allowed under this subsection must not be less than $100/month (or $200/month if dependants): COEA s. 3(5).Exceptions: If enforcement of family maintenance orders, exemption is 50% if wages less than $600/month and 33.3% for wages exceed $600/month (but must not be less than $100): COEA s. 3(7). If debt is for boarding, minimums may not apply (see s. 3(6)). Variation: creditor or debtor may apply to increase/decrease value of exemption. Cannot result in exemption greater than 90% of wages or less than $100/200: COEA s. 4.ArtArt/objects of cultural/historical significance brought into BC for temporary public exhibition exempt from seizure/sale: COEA s. 72(1).Exception: Does not apply if (1) judgment is WRT K for transportation/storage/exhibition of the object (2) object is offered for sale: COEA s. 72(2).Life Insurance Life insurance does not form part of estate of the insured & is not subject to insured’s creditors’ claims: IA s. 65(1). If policy contains a designation in favour of a spouse, child, grandchild or parent of insured, insurance money and the rights and interests of the insured in it and in the contract are exempt from execution or seizure: IA s. 65(2). Workers CompensationComp. $ cannot be attached or charged: WCA s. 15. Crown DebtsProvincial: No execution or attachment enforcing payment by the government of money or costs: CPA s. 13(6). Federal: No execution on a judgment against the Crown (for Crown property): CLA s. 29. Property owned/leased by Crown is immune from seizure: Cybulski (Crown van)Canada Pension PlanBenefits cannot be charged, attached etc.: CPP s. 65.Benefit is exempt from seizure and execution, either in law or equity: CPP s. 65(1.1).Old Age SecurityBenefits cannot be charged, attached etc.: OASA s. 36.Benefit is exempt from seizure and execution, either in law or equity: OASA s. 36. Indian ActReal and personal property of an Indian or a band situated on a reserve is not subject to execution (except if favour or Indian or band): IA s. 89(1).2 step analysis for determining location: Bastien.Identify all the potentially relevant factors tending to locate the asset.Determine what weight they should be given in light of the purpose of the exemption. Creditor Priorities General Rule: Creditor Assistance Act There is no priority amongst creditors in BCSC or BCPC: CAA s. 46.Applies to seizure and sale of personal property and land.Sheriff must record levies of money of execution creditors in a book (available to the public): CAA s. 2. The sheriff must hold the money levied for 30 days, after which it must be distributed rateably among all execution creditors and other creditors who have delivered writs or certificates: CAA s. 3.“Other creditors”: includesCertificate-holders (granted where the debtor does not contest the debt): CAA s. 11.Any other creditor, whether the debt is due or not, if the JD permits an execution to remain unsatisfied for 20 days after seizure/2 days before sale: CAA s. 11.“Levy”: receipt of money following sale: Finney.Garnishing orders: If there are no writs in the hands of the bailiff at the time that a GO issues, the CAA does not apply: Tan. If there are writs in the bailiff’s hands and the debtor does not appear to have sufficient assets to satisfy them all, the proceeds of the GO must be paid to the bailiff and shared pro rata: CAA s. 34. Priority between secured creditors and registered judgments:In Hankin, there was a mortgage registered on title after 3 judgments, but before 8 others. The court held that all of the judgment creditors ranked ahead of the mortgagee. This case appears to have been wrongly decided. Nothing in the CAA suggests that registration places judgment creditors ahead of secured creditors: it simply abolishes priority between the judgment creditors. The correct disposition would have been to notionally pay out the three judgments ahead of mortgage into a reserve fund for creditors; then to pay the mortgagee; and finally, to pay any remaining proceeds into the creditor fund. The fund would then be held for thirty days, at which point it would be paid pro rata to any creditors who had delivered writs and certificates to the sheriff. Special PrioritiesFamily Maintenance Priority: A maintenance order takes priority over any other unsecured judgment debt of the debtor regardless of when an enforcement process is issued or served: FMEA s. 28(1). Priority is limited to one year of arrears (calculated from date maintenance enforcement proceedings initiated): FMEA s. 28(2).As between multiple family creditors: rank equally regardless of when enforcement process issued/served: FMEA s. 28(3). Corporation liable for debt: If debtor is sole shareholder & has sole beneficial interest in the shares of a corporation, it becomes jointly and separately liable if debtor defaults & corp has been served w/garnishing orders totalling more than $3,000: CAA s. 14.1. Continuing garnishing order: Director can issue a GO for present and future debts, which remains in effect until withdrawn/date specified on GO: FMEA s. 15. Family creditors can apply for a continuing order for a maximum of 12 months: FMEA s. ernment debtors: can garnish FMEA s. 25. Joint accounts: can be garnished; presumed to have an equal interest in $ in account; other account holder can apply for $ back – must demonstrate it was theirs: FMEA s. 15(3.2, 3.3).Non-expiring registration against title: FMEA s. 26.Receiver: Court may appoint a receiver of any property of the debtor. (Unclear whether this is intended to codify the appointment of an equitable receiver, or if has transformed receivership into a statutory remedy. If the latter, then the rules for appointment of equitable receiver would not apply, and you could get one appointed for anything.) FMEA s. 29. RRSPs available to family debtors: COEA s. 71.3(3).Misc. powers: Obtain statement of finances [creditor]: FMEA s. 13. Contempt if not provided: FMEA s. 14. Access government data re: debtor’s employment, assets [director]; avail on application to creditor: FMEA s. 8. ICBC: can refuse to renew driver’s license: FMEA s. 29.1. Director will garnish on behalf of extraprovincial maintenance creditors: FMEA s. 17. Woodworkers LiensA person performing labour or services in connection w/logs or timber has a lien on them for the amount due for the services: WLA s. 2(2). Has priority over other liens, except gov’t or timber slide claims: WLA s. 2(3). Repairers LiensA person who alters or improves the properties of a chattel through the application of skill, materials or money is entitled to a lien over the chattel & has the power to sell the chattel if debt is 90 days past due: RLA s. 2. Wages Lien: Unpaid wages constitute a lien in favour of the director, dating from the time the wages were earned, against all the real and personal property of the employer: ESA s. 87(1). Super priority: Payable in priority over all liens, judgments, charges, security interests, or claims: ESA s. 87(3). Exception: does not take priority over money advanced on a mortgage before the lien was registered: ESA s. 87(5).+ limited priority: payable in priority of unsecured creditors. But note: must have been employed by the debtor at the time/in the month before the levy: CAA s. 36. Crown Entitled to be paid in priority to the other creditors of equal degree: Hong Kong Bank of Canada. Exception: where the Crown claims the benefit of the COEA (e.g. thru registration on title) it is subject to the burdens of the statute (incl. rateable division of proceeds per CAA): Hong Kong Bank of Canada. Crown liens for tax debts arise on the date the debt was incurred, regardless of when/whether tax certificate was registered: Roadberg.Federal Court ExecutionCAA does not apply to federal court execution processes: BC Deputy Sheriff. As a result, the general common law rule of first in time, first in right applies. To avoid application of CAA, federal court judgment creditor must use federal court writs: Hong Kong Bank of Canada. ................
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