Q. The following is a statement of Claim. What are the chances of success?
STATEMENT OF CLAIM
1. On September 05, 2012, the Plaintiff engaged the Defendant, in good faith, in the case of bankruptcy, as a Licensed Insolvency Trustee.
2. The Code of Ethics for Trustees is an integral part of the Bankruptcy and Insolvency General Rules (Bankruptcy and Insolvency, hereinafter, ‘B & I’ Act). The code states that the Trustees shall perform their duties in a timely manner and carry out their functions with competence, honesty, integrity and due care.
3. In early 2013, the plaintiff and the defendant Trustee were not in agreement with the amount, the plaintiff was required to pay as surplus income, mainly on the basis of (a) medical expenses incurred by the plaintiff and his spouse, due to medical conditions, and (b) the method of calculation used by the Trustee, which was not in compliance with the directives of the Superintendent of Bankruptcy, (hereinafter, ‘Superintendent’) for family situation.
4. The ‘B & I’ Act states that if the trustee and the bankrupt are not in agreement with the amount that the bankrupt is required to pay, the trustee shall, without delay, in the prescribed form, send to the official receiver a request that the matter be determined by mediation and send a copy of the request to the bankrupt.
5. The Superintendent, in the Procedural Directive states, that if the bankrupt does not agree with the amount of surplus income to be paid, the trustee must request mediation. If mediation fails, the trustee may apply to the court to fix, by order, the amount the bankrupt is required to pay the bankruptcy estate.
6. The plaintiff made many requests and provided detailed explanations and expert medical opinion for the claims submitted but there was no resolution of the disagreement in determining the surplus income required to be paid.
7. For the subsequent three years, under duress, the Plaintiff submitted all the required thirty six (36) reports and made payments to the Trustee by following the guidelines on medical expenses published by the Canada Revenue Agency.
8. The defendant Trustee simply ignored all submissions for three years and failed to perform his fiduciary obligations in defiance of the ‘B & I’ Act and the Procedural Directive of the Superintendent.
9. On September 04, 2015, the Plaintiff wrote a letter outlining errors in the calculation forms and requested a resolution of disagreement on the calculation of surplus income. There was no response from the defendant Trustee.
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10. On September 08, 2015, the Plaintiff attended a final counselling session as required by the Trustee. The office of the defendant Trustee refused to discuss the issue of surplus income determination, which was ongoing for the past three years, and failed to provide any information regarding an appeal process.
11. On October 14, 2015 the defendant Trustee got a Court Order setting terms of discharge directing the Plaintiff to pay the outstanding surplus income of $14,711. There were no other issues except the surplus income determination; the plaintiff had complied with all other requirements.
12. The defendant Trustee, in his calculation of the outstanding surplus income ignored without explanation, the sum of approximately $27,600, mostly for medical conditions, which was paid by the plaintiff over the three years.
13. The ‘B & I ‘Act states that if the discharge of a bankrupt individual is opposed by the trustee solely on grounds that the bankrupt has failed to comply with a requirement to pay surplus income, the trustee shall send an application for mediation.
14. The Superintendent in the Procedural Directive states that toward the end of a bankruptcy, where the discharge of an individual bankrupt is opposed by the trustee on the grounds that the bankrupt has not made the required surplus income payments, the trustee must ask the Office of the Superintendent of Bankruptcy for mediation. If mediation fails, the trustee may apply to the court to fix, by order, the amount the bankrupt is required to pay the bankruptcy estate.
15. The defendant Trustee again failed to comply with the ‘B & I’ Act and did not care to ask the office of the Superintendent of Bankruptcy for mediation.
16. The defendant Trustee did not perform his fiduciary obligation and did not carry out the duty of care as a Trustee towards the Plaintiff, by ignoring the directive of the Office of the Superintendent of Bankruptcy.
17. The actions of the defendant Trustee have caused the plaintiff a financial liability (Court Ordered surplus income payment of $14,711), three years of aggravation and continuing stress at a time when the plaintiff had been in an extremely vulnerable position.
18. Wherefore, the plaintiff claims against the defendant Trustee:
(a) Compensatory damages in the sum of $15,000
(b) Aggravated damages in the sum of $15,000
(c) Punitive damages in the sum of $20,000
(d) Cost of this action, and
(e) Such further and other relief as to the Honorable Court seems just.